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How does a year of daily loans become an integral, and why does continuous interest slip a factor e^{r(1−t)} inside it?
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Riemann sums and their limit
Write , the sum with any sample point in each piece, and its limit as .
Total borrowed in a year
With rate in dollars per year and , write day 's loan, the 365-term sum, its integral , and the units check giving dollars.
Total owed with continuous compounding
Write the growth factor for day 's loan, the sum of grown loans, and the limiting integral .