Its importance lies in the fact that many physical entities such as velocity, acceleration, force and so on are defined as instantaneous rates of change of some other quantity. The derivative can give you a precise intantaneous value for that rate of change and lead to precise modeling of the desired quantity.

Why are derivatives important in real life?

It is an important concept that comes in extremely useful in many applications: in everyday life, the derivative can tell you at which speed you are driving, or help you predict fluctuations on the stock market; in machine learning, derivatives are important for function optimization.

What is derivative and why is it important?

Derivatives are the financial contracts that derive their value from the underlying assets. The value of a derivative depends upon the value of its underlying asset. The underlying assets, in this case, can be stocks, commodities, indices, currencies, rate of interest or exchange rates.