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A chord in musical theory is three or more notes played simultaneously. Chords are named according to the notes of the scale that they contain.

The Triad

The most commonly used chords, that form the basis of western diatonic harmony are composed of triads: a root note, the third of a relevant scale, and the fifth. For example, an octave of the C major scale consists of the notes: :C D E F G A B C. Fig 1. The C major scale

The triad formed using the C note as the root would consist of C(root), E(third) and G(fifth), and these comprise a C major chord (the designation major denotes the fact that the E is four semitones (a major third) higher than the root note. Fig 2. C, E and G - The C major triad

Using the same scale (and thus, implicitly, the key of C major) a chord may be constructed using the D as the root note. This would be D(root), F(third), A(fifth), which comprise the chord of D minor, since the third, F, is a minor third (three semitones) higher than the root.

Other chords may be constructed in a similar way, taking each note in turn as the root i.e.

E G B -- E minor
F A C -- F major
G B D -- G major
A C E -- A minor
B D F -- B diminished

The last one is something of an oddity, since the fifth (F) is only six semitones (a dimished fifth, or tritone) higher than the root, compared to seven semitones (a major or perfect fifth) in the other chords.

The dominant seventh