I learned of the concept while studying for my my insurance license exam. Basically it is used to calculate compounding interest,to formulate investment strategies, By banks and insurance companies. The simplest way to understand is revealed in a brain teaser type question which you may be familiar with. Would you rather have 1 million dollars or 1 penny doubled every day for 1 month? Most people would take the million. Not a bank they they choose the option every time. Why ? Do the math. Not enough space here to give adequate example. Will send you another message with more info.