Interest rate = Price of money(?)
Nominal interest rate : Opportunity cost of holding money
Real interest rate : Opportunity cost of holding real assets
Inflation : The rate of increase in price = Decrease in the value of money
Fisser equation : $i = r + \pi$
Usually, it is more likely true that value of real asset remains constant; cause it gives us same utility.
Real interest rate affects decisions for investment.
Monetary policy : Target nominal interest rate. (Want to increase $i$ ? Provide bond : Provide money)
Monetary policy is carried out for a variety of reasons. This may be due to increased consumption and production by lowering real interest rates. However, in most cases, maintaining inflation at the desired level is the central goal.