What Is an Algorithm?
Algorithms in Everyday Tools
Every calculator follows an algorithm: for example, a loan calculator applies a fixed sequence of formulas to the amount, rate, and term to produce a monthly payment.
Algorithms vs. AI
A traditional algorithm follows rules written by people. Machine learning uses algorithms to learn rules from data.
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Last updated: September 29, 2026. This definition is for general educational purposes only. It is not financial, investment, tax, legal, or medical advice, and it does not recommend any product or course of action. For decisions about your own situation, consult a qualified professional.