Nominal v. real interest rates

Nominal interest rates include expectations about inflation. When borrowers and lenders come to an agreement about interest rates, they are agreeing on the nominal rate of interest based on what they want to earn or pay (the real interest rate) and what they expect about inflation.

Real and nominal return

Calculating real return in last year dollars

Nominal interest, real interest, and inflation calculations

Relation between nominal and real returns and inflation

Nominal vs. real interest rates