Multiple economic factors influence interest rates. Three types of interest rates, including real, nominal, and effective affect consumers' borrowing and investment choices. The nominal interest ...

You can calculate the real interest rate by subtracting the rate of inflation from the nominal interest rate. Here's the formula: Real interest rate = nominal interest rate - rate of inflation ...

The real economic growth rate removes inflation in its measurement of economic growth, unlike the nominal GDP growth ... use real GDP when determining interest rates, tax rates, and trade policies.