Find out why subtracting a negative number is the same as adding the absolute value of that number. Created by Sal Khan.
This is Steve and this is Steve's uncle and Steve is in a bit of a bind. Not only does he not have any money but he also owes Michael, who is not depicted here. He owes Michael $3. So he actually has a negative net worth. Steve has a net worth of -3. Steve's uncle cares about Steve and feels bad that he doesn't even have a 0 net worth; he has a negative net worth! And so Steve's uncle wants to at least take away some of this pain. He at least wants to get Steve back to a neutral net worth, a 0 net worth. So he decides to take away Steve's negative net worth. He wants to take away that -3. What happens if you take away that -3? Well, that should get you back to 0. If you take away anything... if you have something and you take it away, it should go back to 0. Similarly if you owe people things and that owing people things is taken away, it also gets back to 0. And another way to think about it is how Steve's uncle would actually take that liability, take that debt away from Steve. Well, the easiest way he could do it if Steve is starting at -3 net worth is for his uncle to give Steve $3, so that he(Steve) can get back to a net worth of 0. So hopefully, that makes it a little bit clearer, that this and this are intuitively equivalent.