To further confuse things, hardwood sizing standards are different than softwood standards, and hardwood is typically sold by a unit of volume known as the board foot, not by board dimension.  All of this can make things rather confusing when you are buying lumber to make a project to precise dimensions.

Nominal vs. Actual Measurements of Dimension Lumber

The term dimension lumber is used with softwood species (such as pine or fir) that are used in the building trades for framing and other carpentry uses. The reasons why the nominal dimension of this lumber (what the lumber is called) is larger than the actual dimensions involves historical practices in the lumber industry. Originally, a 2 x 4 was cut as a rough green board that was exactly 2 x 4 inches in size, but by the time the boards were dried and planed, the boards became smaller, approaching the now-standard 2 x 4 dimensions of 1 1/2 x 3 1/2 inches in size. In modern lumber practices, the boards are no longer exactly 2 x 4 inches when first cut, but today’s drying and ​​planing methods still leave the board 1 1/2 inches thick and 3 1/2 inches wide. The old standard of calling this board a 2 x 4 still remains, even though in today’s lumber practices, the board has never been 2 x 4 inches in size. The actual vs. nominal sizes for common sizes of dimension lumber:

Hardwood Sizing

The sizing standards used for hardwood lumber (such as oak, maple, birch, and mahogany) of the type used in fine cabinetry and furniture is a bit more confusing. Not only are different measurement standards used, but the sizing also depends on whether the stock is surfaced on one side (S1S) or on two sides (S2S). Additionally, hardwood may be sold in quarters. Each quarter refers to 1/4 inch of thickness, meaning that a 5/4 board is roughly 1 1/4 inches thick. If your project calls for a piece that is exactly 1 inch thick, you’ll want to purchase a 5/4 board and mill it down to the proper size using a jointer/planer.

Plywood

Plywood is usually sold in 4 x 8-foot sheets. The most common nominal thicknesses of plywood are 1/2 inch and 3/4 inch, but once again the actual sizes are slightly different. A sheet of 1/2-inch plywood is really 15/32 inch thick, while a 3/4-inch sheet is 23/32 inch thick. Plywood is graded so that each face receives a grade of A, B, C, or D, with A representing the smoothest sanded finish. For example, AA plywood has a furniture-grade finish on both sides, while BC plywood will be graded B on one side and C on the other.