Nominal vs Notional: When To Use Each One? What To Consider

Have you ever heard the words nominal and notional and wondered what they mean? These two words are often used interchangeably, but they actually have different meanings. In this article, we will explore the differences between nominal and notional and when to use each one.

Let’s define these two words. Nominal refers to something that is existing in name only, while notional refers to something that is based on an idea or notion rather than a physical existence. In other words, nominal refers to something that is symbolic or theoretical, while notional refers to something that is conceptual or abstract.

So, which of these two words is the proper word to use? The answer is that it depends on the context. Nominal is often used to describe things like prices, fees, or titles, where the actual value or importance of the thing is not as significant as the name or label attached to it. Notional, on the other hand, is often used to describe things like concepts, ideas, or theories, where the physical existence of the thing is not as important as the idea or notion behind it.

Now that we have a basic understanding of what these two words mean, let’s dive deeper into their differences and how they are used in different contexts. By the end of this article, you will have a better understanding of when to use nominal and when to use notional.

Define Nominal

When we talk about something being nominal, we mean that it is existing in name only, and not in reality or fact. In other words, nominal refers to something that is in name or form only, but not in substance or essence.

For instance, a nominal leader is someone who holds a position of authority in name only, but does not have any real power or influence. Similarly, a nominal fee is a fee that is charged only in name, but is so small that it is almost negligible.

In finance, nominal values are used to describe the face value of a security or asset, without taking into account any inflation or other factors that may affect its true value.

Define Notional

The term notional is used to describe something that is based on an idea or concept, rather than on any actual or concrete evidence. In other words, notional refers to something that exists only in theory or imagination, and not in reality.

For example, a notional amount is a theoretical or hypothetical amount that is used for the purpose of calculation, without actually being exchanged. In finance, notional value is often used to describe the total value of a derivative contract, without actually taking into account the amount of money that is exchanged.

Similarly, a notional idea is an idea that is based on theory or speculation, rather than on any actual evidence or experience. Notional concepts are often used in academic or philosophical discussions, where the focus is on exploring ideas and theories, rather than on practical applications.

How To Properly Use The Words In A Sentence

Using the right words in a sentence is important to convey the intended meaning. The words “nominal” and “notional” are often used interchangeably, but they have distinct meanings. Here’s how to use them correctly:

How To Use “Nominal” In A Sentence

The word “nominal” is usually used to describe something that is small or insignificant. It can also mean something that is in name only, without any real value or substance. Here are some examples of how to use “nominal” in a sentence:

• The company charged a nominal fee for its services.
• She held the nominal title of CEO, but the real power lay with the board of directors.
• The car’s fuel efficiency was only nominal, despite the manufacturer’s claims.

As you can see, “nominal” is used to describe something that is small or insignificant, or something that exists only in name.

How To Use “Notional” In A Sentence

The word “notional” is used to describe something that exists only in theory or as a concept, rather than in reality. It can also mean something that is based on an idea or notion, rather than on concrete evidence. Here are some examples of how to use “notional” in a sentence:

• The company’s notional profits were much higher than its actual profits.
• The notional value of the property was much higher than its market value.
• The concept of time travel is purely notional, with no scientific evidence to support it.

As you can see, “notional” is used to describe something that exists only in theory or as a concept, or something that is based on an idea rather than on concrete evidence.

More Examples Of Nominal & Notional Used In Sentences

In order to better understand the difference between nominal and notional, it is helpful to see them used in context. Here are some examples of how these words can be used in sentences:

Examples Of Using Nominal In A Sentence

• The nominal cost of the product is only $10, but there are additional fees.
• He holds the nominal title of CEO, but the real decision-making power lies with the board of directors.
• My salary increase was nominal, only a few cents per hour.
• The company’s profits were nominal due to the high cost of production.
• The nominal value of the bond was $1000, but it was sold for much more.
• She was given a nominal award for her years of service, but it was clear that her contributions were much greater.
• His role in the project was nominal, as he only provided minor assistance.
• The nominal GDP of the country has increased, but it does not reflect the true economic situation.
• The nominal interest rate is low, but the real interest rate is much higher due to inflation.
• She was only given nominal control over the project, as the team members made most of the decisions.

Examples Of Using Notional In A Sentence

• The notional value of the property is much higher than the actual selling price.
• His notional understanding of the subject was limited, but he was eager to learn more.
• The notional deadline for the project was next week, but it was extended due to unforeseen circumstances.
• She had a notional idea of what the final product should look like, but it was still in the early stages of development.
• The notional weight of the package was estimated to be around 10 pounds, but it was actually much heavier.
• His notional plan for the weekend was to relax at home, but he ended up going out with friends.
• The notional size of the project was underestimated, and it ended up taking much longer than expected.
• She had a notional understanding of the language, but she struggled to communicate effectively.
• The notional cost of the trip was high, but it was worth it for the experience.
• His notional approach to the problem was unconventional, but it ended up being successful.

Common Mistakes To Avoid

When it comes to using the terms nominal and notional, many people tend to use them interchangeably, which is a common mistake. However, these two terms have different meanings and should not be used interchangeably. Here are some common mistakes that people make when using nominal and notional interchangeably, along with explanations of why they are incorrect:

1. Using Nominal And Notional As Synonyms

One of the most common mistakes people make is using nominal and notional as synonyms. Nominal refers to the face value or the stated value of something, whereas notional refers to something that is theoretical or imaginary. For instance, if you say that the nominal value of a car is $20,000, it means that this is the value that is stated on the car’s title or registration. On the other hand, if you say that the notional value of a car is $20,000, it means that this is the theoretical value of the car, which may not reflect the actual market value of the car.

2. Using Nominal When Notional Should Be Used

Another common mistake is using nominal when notional should be used. For instance, if you say that the nominal interest rate is 5%, it means that this is the rate that is stated on the loan or bond. However, if you want to refer to the actual interest rate that takes into account inflation, you should use the notional interest rate instead.

3. Using Notional When Nominal Should Be Used

Conversely, some people make the mistake of using notional when nominal should be used. For example, if you say that the notional GDP of a country is $10 trillion, it means that this is the theoretical value of the country’s GDP, which may not reflect the actual value. However, if you want to refer to the actual value of the country’s GDP, you should use the nominal GDP instead.

Tips To Avoid These Mistakes

To avoid these common mistakes, it’s important to understand the difference between nominal and notional. Always use nominal when referring to the face value or the stated value of something, and use notional when referring to something that is theoretical or imaginary. If you’re not sure which term to use, it’s always better to look it up or ask someone who knows. By avoiding these mistakes, you can ensure that your writing is clear, concise, and accurate.

Context Matters

When it comes to determining whether to use nominal or notional, context is key. The choice between the two can depend on the specific context in which they are being used. Below are some examples of different contexts and how the choice between nominal and notional might change:

Financial Context

In the financial context, nominal and notional are often used to describe the value of assets. Nominal value refers to the face value of an asset, while notional value refers to the hypothetical value of an asset. For example, if you have a bond with a face value of $1,000, the nominal value of the bond is $1,000. However, the notional value of the bond may be different depending on the terms of the bond. If the bond is structured to pay out based on a percentage of the notional value, then the notional value becomes important.

Linguistic Context

In linguistics, nominal and notional are used to describe the function of words in a sentence. Nominal refers to words that function as nouns, while notional refers to words that express an idea or concept. For example, in the sentence “The dog chased the ball,” “dog” is a nominal word because it functions as a noun. However, in the sentence “Happiness is a warm puppy,” “happiness” is a notional word because it expresses an idea or concept.

Mathematical Context

In mathematics, nominal and notional are used to describe the difference between values. Nominal refers to the stated or named value of something, while notional refers to the theoretical or calculated value of something. For example, if you have a stock that is currently trading at $50 per share, but has a nominal value of $1 per share, the notional value of the stock is $50 per share. This is because the notional value takes into account the current market value of the stock, rather than just the nominal value.

As you can see, the choice between nominal and notional can vary greatly depending on the context in which they are being used. It is important to understand the specific context and how each term is being used in order to make the right choice.

Exceptions To The Rules

While nominal and notional are generally used in specific contexts, there are some exceptions where the rules for using them might not apply. Here are a few examples:

1. Use Of Nominal In Informal Settings

While nominal is typically used in formal settings, it can also be used in informal settings. For example, in casual conversations, people might use nominal phrases like “a ton of money” or “a boatload of work” to indicate a large amount or quantity. These phrases are not meant to be taken literally and are instead used for emphasis or exaggeration.

2. Use Of Notional In Technical Writing

While notional is typically used in non-technical writing, it can also be used in technical writing to indicate abstract concepts or ideas. For example, in computer programming, notional values might be used to represent variables or functions that are not directly tied to a specific value or object.

3. Use Of Nominal In Certain Languages

While nominal is typically used in English, other languages might have different rules for using nominal and notional. For example, in some languages, nominal might be used to refer to abstract concepts or ideas, while notional might be used to refer to specific objects or things.

4. Use Of Notional In Poetry Or Literature

While notional is typically used in non-literary contexts, it can also be used in poetry or literature to convey abstract or symbolic meanings. For example, a poet might use notional language to describe the beauty of nature or the complexity of human emotions.

Overall, while nominal and notional are typically used in specific contexts, there are exceptions where the rules might not apply. It’s important to understand these exceptions and use the appropriate language based on the context and audience.

Practice Exercises

Now that we have discussed the differences between nominal and notional, it’s time to put your knowledge to the test. Below are some practice exercises that will help you improve your understanding and use of these terms in sentences. Make sure to read the instructions carefully before attempting each exercise.

Exercise 1: Identifying Nominal And Notional

Read the following sentences and identify whether the underlined word is nominal or notional.

Sentence	Word	Nominal or Notional?
The idea of starting a business is exciting.	Idea	Notional
The problem with this plan is that it’s too risky.	Problem	Nominal
She has a lot of experience in this field.	Lot	Nominal
He has a passion for music.	Passion	Notional

Answer Key: 1. Notional, 2. Nominal, 3. Nominal, 4. Notional

Exercise 2: Using Nominal And Notional In Sentences

Complete the following sentences with either a nominal or notional word.

1. Her ___ for art led her to pursue a degree in fine arts.
2. The ___ of this project is to increase sales by 20%.
3. He has a ___ for languages and can speak five fluently.
4. The ___ of this book is to provide a comprehensive guide to cooking.

Answer Key: 1. Notional (passion), 2. Nominal (goal), 3. Notional (knack), 4. Notional (purpose)

By practicing these exercises, you can improve your understanding and use of nominal and notional in sentences. Keep in mind that nominal words are concrete and refer to specific objects or things, while notional words are abstract and refer to ideas or concepts. With enough practice, you’ll be able to use these terms with confidence in your writing and speech.

Conclusion

In conclusion, understanding the difference between nominal and notional is crucial for anyone who wants to communicate effectively. Nominal refers to something that exists in name only, while notional refers to something that exists in the mind or as an idea. These two concepts are often used interchangeably, but they have distinct meanings that can greatly impact the clarity and accuracy of your writing.

By using nominal and notional correctly, you can avoid ambiguity and ensure that your message is conveyed accurately. Remember that nominal refers to something that is concrete and tangible, while notional refers to something that is abstract and intangible.

Key Takeaways

• Nominal refers to something that exists in name only, while notional refers to something that exists in the mind or as an idea.
• These two concepts are often used interchangeably, but they have distinct meanings that can greatly impact the clarity and accuracy of your writing.
• By using nominal and notional correctly, you can avoid ambiguity and ensure that your message is conveyed accurately.

Remember that language is a complex and ever-evolving system, and there is always more to learn. Keep exploring the nuances of grammar and language use, and you will become a more effective communicator.