In many applications, accuracy is a requirement. For example, a car engine must have close fitting parts, or every tape measure must be calibrated to a standard norm. These are real measurements. Nominal measurements, on the other hand, do not have to be precise. "Close enough" is good enough. An example is a soccer ball kicked into a goal. The goal is usually rectangular, and as long as the ball goes through any part of the goal, the team scores a point.
Tolerance is a criteria when understanding nominal and real. Tolerances are usually expressed as a plus or minus percentage of the the real measurement. Suppose you have to cut a board 6 inches long, plus or minus 10 percent. Ten percent of 6 is .6 inches. Therefore, the board can be anywhere from 5.4 inches (6 minus .6) to 6.6 inches (6 plus .6), a difference of 1.2 inches. If the wood falls within that range, it is still in tolerance, because this is a nominal measurement.
The larger the measurement, the more critical tolerance becomes. Suppose an airplane has to land 600 miles away, plus or minus 10 percent. Ten percent of 600 miles is 60 miles. Therefore, the airplane can land anywhere from 540 miles to 660 miles away. A 120-mile tolerance to land is unrealistic since the runway is at a very precise spot. In this case, a real measurement is required with no tolerance.
Many pipes and lumber sizes are in nominal measure. This means the size can vary along the length of the pipe or piece of wood. A pipe 3 inches in diameter (the real measure) can have spots measuring 2-7/8 inches, or 3-1/8 inches. Fittings are designed for the larger upper tolerance number, so the pipe fits into the sleeve of the fitting. Any extra space is normally taken up by the glue.
The Encyclopedia of Home Improvements points out that problems do occur with nominal measurements. A common building size for lumber is a 2-by-4. This is the real measurement, rough cut from the sawmill. After sanding, the nominal size becomes 1-1/2 inches by 3-1/2 inches. If you design a house, nominal sizes must be used since using real sizes leads to problems. One such problem is a 2-by-8 is actually 7-1/2 inches wide. If you design a ceiling height of 8 feet, using a 7-1/2 inch wide joist will lead to a ceiling height of 8 feet, 1/2 inch. Drywall panels are sized 8-by-4 feet. This leaves a half-inch gap where the ceiling meets the wall, which is unacceptable.