Again, with all due respect, that is not the only usage in finance.

Nominal (sometimes called *stated*) is also contrasted with effective. An effective interest rate includes the effects of compounding; a nominal (stated) interested rate does not.

If you invest $100 for one year at an effective (annual) rate of 6%, at the end of the year you will have $106 in your account.

If you invest $100 for one year at a nominal (annual) rate of 6% compounded semiannually, at the end of the year you will have $106.09 in your account.

Of course there is. You can have an effective rate for any length of time. If you can compound it, itâ€™s an effective rate.

In my second example, above, the semiannual effective rate is 3% (= 6% Ă· 2).