This is a great question! A typical home is actually powered by an AC source. The source of that power is 170 volts roughly of AC voltage. What you are measuring is 120 volts RMS! This means that your digital multimeter is reading 120 volts rms, which is the AC equivalent of DC power. If you have ever noticed, a good quality DMM, will have True RMS at the top of it. This means that your DMM is doing the calculations for you, to show you the DC equivalent without having to do all the math yourself. The equation is Peak Voltage divided by the root of 2. To do this equation yourself, you need to know the peak value of your AC source, which in our case is 170 volts AC. You would then take the 170 volts divided by the root of 2, which equals roughly 120 volts RMS (120.21 volts for more exact answer). This shows that our 170 volts AC roughly equals 120 volts DC, with it formally known as 120 volts RMS. Below is a great video for more information:
