Introduction to compound interest and e | Algebra II | Khan Academy
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- Опубліковано 21 кві 2008
- Compounding interest multiple times a year.
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My friend,
With a degree in finance from a prestigious midwestern business school, I am rather embarrassed to admit that... Prepayment penalties had not made immediate, intuitive sense to me. I knew that a lender would unexpectedly be forced to attempt to find a new borrower (which I had always understood, to a certain extent, to be a undesirable consequence of prepayment); however, in the example you've so generously taken the time to produce for the masses, you explain how the lender would permit a 6 month loan at half the 12mo interest rate with a caveat: should borrower then require the full 12 months... Lender would permit REBORROWING at the same 6mo rate. At this, the lights finally turned fully on and my brain lit up... finally, after all these years getting it! And I owe it all to the Khan academy for these amazingly brilliant yet simple instructional videos! Thank you, Sal. Thank you so much.
the video quality makes me want to cry
I love it
He said, it's basically like this: (1.085 + (.085*1.085)). So if you factor out the 1.085 it looks like: (1.085)(1 + .085). Simplify that and it's (1.085)(1.085), which is (1.085)^2. This continues as each month passes and the exponent changes.
"I hope it makes cents to you." ba dum
SharanHasFun yrtstopd
Here's his updated video:
www.khanacademy.org/math/algebra2/exponential-and-logarithmic-functions/e-and-the-natural-logarithm/v/e-through-compound-interest
This makes more sense.
Sal would definitely make a good loan shark name :)
Nice video - you have a good way of explaining things. Cheers.
Thanks, been trying to find that connection for a bit here.
@jeepnypitpits He got the example problem mixed up. If you borrow at half the rate (50%) for half as long, you'd get 1.25, given you only compound interest once. I haven't seen the video with exponents, logs, ln, and e yet, gonna have to check it out. I recommend you do the same. Cheers
Nonsense, you can benefit humanity in other ways and even if you can't, that doesn't mean you should die.
i like how he is using a calculator
Not trying to be negative here! But is it just me but the writing is pixeled and sorta hard to read?
I love math, hate cooking though. What's with the "go die"? Seems like a slight overreaction.
i feel like he was trolling towards the end
is there some books of this subject (basic math fin) ?
what playlist is this in??
wow, glad I only borrowed ONE dollar! ;) and by the way what time period is semi-annually considered? If its 2 that you would divide the interest rate with, is that in months? Because wouldn't a year be 12?
@DadizTV use the Formula.
Amt=P (1 + r/100)^2
THerefore, 2500=2000 (1 + r/100)^25/10 or 2.5
:: 2500 - 2000 = (1 + r/100)^2.5..so on.i think
10:02 should be (1.0027)³⁶⁵
Top tier caculator.
Feed my kids with a dollar? ROFL. I guess the setting is back in the day.
I am doing an assignment on compound interest in math, and I have to answer this question: What is the theory? What does it state? (Postulates, fundamental concepts, etc…). Any ideas on how I could answer both of these?
do you still need help?
Let's make math fun! ...by using a hypothetical loan interest percentages negotiation.
when you do the example the time period should be converted in to a year when you do a simple intrest
Sal, i need a Dollar
Dang, its been 10 years
* 1.0027^365
What. The. Fucking. Goodness.
"Find the interest rate (in % p.a.) compounded monthly necessary for $ 20000
to accrue to $ 25000 in 2 ½ years."
can any one just tell me how to solve this my mind is fucked
Not the best khan video...sadly
ok in theory -- but learn your basic multiplication tables, dude. 8 x 12 = 96. 100/12 = 8 and 1/3 aka 8.33... fix it for the video.
HELP!!!
a car was bought for 25000$, each year it depreciates by 15%...
a) write an exponential formula that demostrates the cars value in (n) amount of years after it was purchased/
b) what is the cars value at the end of 3 years
c) after how many years will the value of the car be half of the original price?
PLZ HELP!!!! THANK YOU!!!
Just another example of the blatant advantage being taken of the customers of Sal, the evil loan shark.
@bittul completely right, xD
Isn't 100% interest rate illegal?
10:05 don't let your phone interrupt like that!!!!
Does this only work when the original principal is $1?
I feed my children with one dollar....XD
I hate math and my mom makes me do 3-11 pages a day, but not my older brother. 😒😢
Still does?
So... I spent 10 minutes and 11 seconds of my life watching stuff I already know, with the belief that I was to be introduced to the number e in this video, only for it to end without any mention of e? Why is it even in the title?!
@jeepnypitpits It is wrong because you use a calculator for such an easy task. Even if you had very little knowledge of Maths you would know that 1+50% = 1$+(50% or 0.5 or 1\2 of 1)$ = 1$+0.5$ = 1$+0.50$ = 1.50$
@afreakenracoon I'd chose "A" , but thats me
why not just simply use 10% per month instead of 8.5%? this should make it simple.
hop mash
0.2739
50
why is 1+.50(50%) = 1.50 when my calc is saying 1+.50(50%) = 1.25 my calculator is Casio fx-991ES :-)
100/12 - 8.333333
no...
Georgian?
finances
1 == 100,000
I cant hear this video
..... I'm in grade 7, can't I just learn this like in 5 years... Don't really need it now -_-
Guess what
100 ÷ 12 = 8.5 🤔....can't understand this one.. Please explain
Loan shark Sal padded the interest rate a little bit.
Lol your examples are slightly off. You said 1+.5(.5)=1.5 when i think what you meant to write was 1+1(.5)=1.5
+Jesse VIP that blew my mind
he used the bracket as used in english
what's wrong about that ?
I’m just confused.
This doesn’t sound like english to me😭😭 I don’t understand math😪
*girlynathalie.xo1* Algebra is not difficult. However, his delivery and presentation aren't optimal. That said, you do need the desire and willingness to put in the necessary effort to learn anything.
I cant ever read with the tools you use. They need to be thinner and you need to not moosh it all so close together.
Hi guys,
I have a question. Let's say that the Principal is $20 at rate 10% compound interest over 6 months. Correct me if I'm wrong: $20(1+0.10/6)^6^(1) --> 22.0852../6 = 3.68.... interest per month?? am I right?
$20 for 1 year at interest gets $22 does it make sense getting $22.0852... for 6 months, but $22 for 1 year. for 12 months $22.094... these are the formulas that I used: 20*(1+0.1)^1 and 20*(1+0.1/12)^12^1, please someone throw some light on the matter :)
Hopefully, don't spam but I think I got it, why there is a difference. In the first example it is compound only once 20*(1+0.1)^1 , but in the second example interest is compounded every month (12 months) 20*(1+0.1/12)^12^1 and that is why the total amount is larger? From what I can tell from a lender's point of view it is better the interest to be compounded every month rather than once a year.
dude not right. 1.25 not 1.50
local loan shark haha
50% of 1 in six months - 25 cents. comon sal tht ruins the whole vid
buying a suit with a dollar...
Sal, is math difficult?
No, because of Sal it's lot easier.
Sal i need a Dollar
r u musim
gay
I hate math so much!