Quote:
Originally Posted by nfotiu
I'm definitely not on Butterfly's side here as I don't think this does anything to gain a cap advantage.
But, you can't start calling people financially illiterate when you are mixing up finance terms that have a definition.
For the record, a nominal dollar is what the check is actually written for when the person gets it. A real dollar is the value of that dollar adjusted for time.
If the contract calls for a 10 million dollar payment 10 years from now, and with a 5% discount rate, the PV is ~6 million, the nominal value of the contract is 10 million, while the real dollar value is 6 million.
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I’m just using the same definition she’s using. Both real dollars and nominal dollars increase.