What term describes an interest rate that does not take into account the effects of inflation?

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When evaluating quoted interest rates, the term that describes a rate not accounting for inflation is the nominal interest rate. It shows the percentage in currency terms, but it doesn’t reveal how much purchasing power changes after inflation. The real interest rate, by contrast, subtracts expected inflation to show true purchasing power gain or loss. The effective rate accounts for intra-year compounding, and the discount rate is used to bring future money back to present value. So the nominal rate is the one you see that doesn’t incorporate inflation effects.