# Exponentiation

**Exponentiation** is another fundamental mathematical operation, which is readily available in R's base functionality.

In the context of finance, this operation plays a critical role in the computation of **compound interest**, which is pivotal for understanding the **growth of loans or investments** over time.

To exponentiate a number `a`

to the power of `n`

in R, the syntax is `a^n`

. Interestingly, if you're familiar with **Python**, you might recognize the `**`

operator, which can also be used in R (`a**n`

).

Let's consider an example related to probability and combinatorics: finding the **number of possible outcomes** when throwing three dice:

In this case, we calculate it as `6`

(the number of outcomes for **one die**) raised to the power of `3`

(**the number of dice**). Here is the code for this example:

As you can see, this results in `6^3`

, which equals `216`

possible outcomes.

Task

Let's say you invested **$1,000** at an annual interest rate of **13%**. To calculate the total amount of money you would accumulate over a period of **4 years** with compound interest, you would perform the following calculation:

Compute the product of `1000`

and `1.13`

raised to the power of `4`

.

Everything was clear?

Course Content

R Introduction: Part I

## R Introduction: Part I

# Exponentiation

**Exponentiation** is another fundamental mathematical operation, which is readily available in R's base functionality.

In the context of finance, this operation plays a critical role in the computation of **compound interest**, which is pivotal for understanding the **growth of loans or investments** over time.

To exponentiate a number `a`

to the power of `n`

in R, the syntax is `a^n`

. Interestingly, if you're familiar with **Python**, you might recognize the `**`

operator, which can also be used in R (`a**n`

).

Let's consider an example related to probability and combinatorics: finding the **number of possible outcomes** when throwing three dice:

In this case, we calculate it as `6`

(the number of outcomes for **one die**) raised to the power of `3`

(**the number of dice**). Here is the code for this example:

As you can see, this results in `6^3`

, which equals `216`

possible outcomes.

Task

Let's say you invested **$1,000** at an annual interest rate of **13%**. To calculate the total amount of money you would accumulate over a period of **4 years** with compound interest, you would perform the following calculation:

Compute the product of `1000`

and `1.13`

raised to the power of `4`

.

Everything was clear?