ArithmeticException thrown during BigDecimal.divide

Answer 1

Notice we are using a computer... A computer has a lot of ram and precision takes ram. So when you want an infinite precision you need
(infinite * infinite) ^ (infinite * Integer.MAX_VALUE) terrabyte ram...

I know 1 / 3 is 0.333333... and it should be possible to store it in ram like "one divided by three" and then you can multiply it back and you should have 1. But I don't think Java has something like that...
Maybe you have to win the Nobel Price for writing something doing that. ;-)

Answer 2

I accept that Java doesn't have great support for representing fractions, but you have to realise that it is impossible to keep things entirely precise when working with computers. At least in this case, the exception is telling you that precision is being lost.

As far as I know, "infinite precision arithmetic with decimal numbers" just isn't going to happen. If you have to work with decimals, what you're doing is probably fine, just catch the exceptions. Otherwise, a quick google search finds some interesting resources for working with fractions in Java:

http://commons.apache.org/math/userguide/fraction.html

http://www.merriampark.com/fractions.htm

http://stackoverflow.com/questions/474535/best-way-to-represent-a-fraction-in-java

Answer 3

By the way, I'd really appreciate insight from people who've worked with financial software. I often heard BigDecimal being advocated over double

In financial reports we use alwasy BigDecimal with scale = 2 and ROUND_HALF_UP, since all printed values in a report must be lead to a reproducable result. If someone checks this using a simple calculator.

In switzerland they round to 0.05 since they no longer have 1 or 2 Rappen coins.

Answer 4

If this is not the right answer, what CAN we use for exact division in financial calculation? (I mean, I don't have a finance major, but they still use division, right???).

You did high school maths right? You did learn about how (for example) when you divide by 1 by 3 you get a 0.33333... i.e. a recurring decimal? Division of numbers represented in decimal form is NOT exact.

When you do financial calculations involving division, you have to consider the what to do with a recurring fraction. You can round it up, or down, or to the nearest whole number, or something else, but basically you cannot just forget about the issue.

The BigDecimal javadoc says this:

The BigDecimal class gives its user complete control over rounding behavior. If no rounding mode is specified and the exact result cannot be represented, an exception is thrown; otherwise, calculations can be carried out to a chosen precision and rounding mode by supplying an appropriate MathContext object to the operation.

In other words, it is your responsibility to tell BigDecimal what to do about rounding.

EDIT - in response to these followups from the OP.

How does BigDecimal detect infinite recurring decimal?

It does not explicitly detect the recurring decimal. It simply detects that the result of some operation cannot be represented exactly using the specified precision; e.g. too many digits are required after the decimal point for an exact representation.

It must keep track of and detect a cycle in the dividend. It COULD HAVE chosen to handle this another way, by marking where the recurring portion is, etc.

I suppose that BigDecimal could have been specified to represent a recurring decimal exactly. (Or to put it another way, it would effectively be a BigRational.) However, this would make the implementation a lot more complicated, it would make all operations more expensive, and would make it impossible for applications to put a bound on the space used by BigDecimal objects resulting from complex calculations; e.g. power series expansions that approximate irrationals.

The bottom line is that this extra complexity and runtime cost would be inappropriate for typical use-cases for BigDecimal. This includes financial calculations, where accounting conventions do not allow you to use recurring decimals.

Answer 5

If you want to work with decimals, not rational numbers, and you need exact arithmetics before the final rounding (rounding to cents or something), here's a little trick.

You can always manipulate your formulas so that there's only one final division. That way you won't lose precision during calculations and you'll always get the correctly rounded result. For instance

a/b + c

equals

(a + bc) / b.

Answer 6

Is there a need for

a=1/3;
b=a*3;

resulting in

b==1;

in financial systems? I guess not. In financial systems it is defined, which roundmode and scale has to be used, when doing calculations. In some situations, the roundmode and scale is defined in the law. All components can rely on such a defined behaviour. Returning b==1 would be a failure, because it would not fulfill the specified behaviour. This is very important when calculating prices etc.

It is like the IEEE 754 specifications for representing floats in binary digits. A component must not optimize a "better" representation without loss of information, because this will break the contract.

Answer 7

You should prefer BigDecimal for finance calculations. Rounding should be specified by the business. E.g. an amount (100,00$) has to be split equally across three accounts. There has to be a business rule which account takes the extra cent.

Double, floats are not approriate for use in financial applications because they can not represent fractions of 1 precisely that are not exponentials of 2. E.g. consider 0.6 = 6/10 = 1*1/2 + 0*1/4 + 0*1/8 + 1*1/16 + ... = 0.1001...b

For mathematic calculations you can use a symbolic number, e.g. storing denominator and numerator or even a whole expression (e.g. this number is sqrt(5)+3/4). As this is not the main use case of the java api you won' find it there.

Answer 8

The class is BigDecimal not BigFractional. From some of your comments it sounds like you just want to complain that someone didn't build in all possible number handling algorithms into this class. Financial apps do not need infinite decimal precision; just perfectly accurate values to the precision required (typically 0, 2, 4, or 5 decimal digits).

Actually I have dealt with many financial applications that use double. I don't like it but that was the way they are written (not in Java either). When there are exchange rates and unit conversions then there are both the potential of rounding and bruising problems. BigDecimal eliminates the later but there is still the former for division.