Compound interest introduction | Interest and debt | Finance & Capital Markets | Khan Academy 

😹 😹 😹 💔

Hope u did well 🤣

Bro same 😂

😂

Me 2 min before exam : watching this x10 speed

TrexK when did u learn it

forever army, sone, and wannable We got taught about compound interest in my senior year. Wayyyy too late. Should've been way earlier.

@@TrexK oof I'm learning this in 7th grade

everz I'm learning this in yr11... my bro is in grade8 and there's no way that they can do this!

@@diamond_gamer7289 yall funny

make it super complicated too

You must hate kids or something.

I’m in ninth grade and can’t understand at all gg kiddo

you are still paying it aren't you?

@@NoOneAM2 paid it off

@@johannesasfaw nice

Low rate of 1% helps (for youth)

lol

Maybe do it YOURSELF

nope, get a life klm weight loss journey

Chris LaTerza no

its B O D M A S and not B'E'DMAS!

its B O D M A S and not B'E'DMAS!

guys, stop being silly. It's PEMDAS

are you sure the formula isnt P x (1+r)^n?

+Jorge jr you can invest in mutual funds

Index fund

This isn't a Math topic

Because it's meant to be uselessly hard to understand fuck this shit

Because you're stupid

You can understand it for sure, a human inventing this. Look at other channel some of them explain it more easier....chill you've got this!! I found this channel and he explain it prettey them well: ru-vid.com/video/%D0%B2%D0%B8%D0%B4%D0%B5%D0%BE-OQ9Mv2jwQWo.html

Tian Vlašić better not be an English teacher

Simon Genich I am from Croatia

+King Ray Give up!

100% of something is the same as multiplying that something by 1. Does that give you a tip?

You are increasing by 10%, which means you are having the original amount plus the 10%

Jorge Orpinel thank you for putting it that way! Opened my eyes to the formulas

get a lfife

My last brain cell before an exam

I live in Canada. Maybe I can help you. Where are you from?

@Karan Because I like to play Sonic The Hedgehog with my Sega Mega Drive console. Furthermore, Canada is the only place you can find one of those. Do you live in Illinois? Are you American?

It's pretty easy tbh

@@vinniesmyyth334 no it's not tbh

@@kaven101 You do this in Highschool. 14 year olds do this. Yes its easy

@@vinniesmyyth334 The way he teaches it is confusing. He should have started off with the formula A=P(1+r/n)t(n). For someone who is trying to learn this freshly this video is not a good example. I love khan vids but this one fell flat. It's not for me so save your insults. People have different opinions, you learn that before kindergarten. Geesh. And in my opinion, this is a bad vid for beginners. ✌

@@kaven101 im not insulting you im telling you the truth. You lesan this in school when you are 14

9th grade.

First let me clear it for you: in the real life you go to the bank then you give them money (deposit) equals to 5000$. Then they say our offer is that it will pay you 2% every month and you will get the cash after a year... That means in the first month you will get interest on your deposit (5000*2% = 100), now you didn't get any cash yet, all the money is still with the bank, you will get all the money after one year. In the second month, they should not give you interest on your original money (which is 5000$) ONLY because your original money and the interest on it is still with bank, in the second month... So they should give you interest on (your original money plus your interest on the original deposit) which is ((Original money + interest on the Original money) * interest rate) = ((5000$ + 100 )* 2%) = 102 . In the third month it is the same procedure they will give you interest on the Original amount plus the interest on the (Original amount + the interest on the Original money) plus the interest on the ( ( interest on the Original money) + (Original money + interest on the Original money) * interest rate + {(Original money + interest on the Original money) * interest rate } * interest rate ).. So it equals to = ( (5000$ + 100 ) + (5000$ + 100 )* 2%) + ( (5000$ + 100 ) + (5000$ + 100 )* 2% ) * 2% ) And so on until the last month... so you don't (add 2%) 12 times to get the compound interest rate. That is wrong because what you did there is taking 24% on 5000 only... Which would be the answer to the following question: find an interest rate of 24% on 5000$... I hope that made it clear for you... there is a formula to calculate the the whole money with the compound interest which is The formula for annual compound interest is A = P (1 + r/n) ^ nt: Where: A = the future value of the investment , including interest P = the principal (deposit) investment amount (the initial deposit ) /// in your question it is 5000$ r = the annual interest rate (decimal) /// meaning not 5% but 0.05 n = the number of times that interest is compounded per year /// in your question it is 12 months so it is 12 times t = the number of years the money is invested /// in your question it is one year keep in mind that this formula calculates not only the compound interest but the whole amount with the compound interest along with it Now to get the compound interest only: it is so simple just think about it.. we have our original money along with all the compound interest.. So to get the compound interest only we simply subtract the original amount.. So : The compound interest = P (1 + r/n) ^ nt - p After Simplifying (taking P as a common factor) : The compound interest = P ( (1 + r/n) ^ nt - 1 ) *Lastly: sorry for the bad English* *:)* I hope that helped..

It is 10% of the previous year which was 110

yeah ikr

a(1+b) = a + ab

⁠@@zr7951distributive property equals multiplication. Since the compounding formula has exponents, exponents come before multiplication/distribution

I agree with you ...it's quite easy even though I am a high school student . In my opinion, the same lesson our teacher taught was more difficult than this ... but it's still a helpful video ...

True i'm learning this right now as a matter of fact... And I'm in 7th Grade!

We've only started learning this in grade 11 -.-

+EpicAdventurer Awesome! I wish I had this in school. Keep up the good work and you'll be well off.

+Jorge Orpinel if you didnt know, people of all ages are watching this! for all you know people who havenever been to school but have a phone and 3g must be watching this! dont judge on how fast a person learns, judge on their interest of learning