LESSON 13: Confusion about how the amountDaiToBorrow is calculated

[Minh-Uchiha]

I know somebody asked this before but I'm still confused. I don't really understand the 1 / daiPrice.toNumber() part of the below line of code:

const amountDaiToBorrow = availableBorrowsETH.toString() * 0.95 * (1 / daiPrice.toNumber())

From what I understand, the daiPrice is the amount of DAI equivalent to 1 ETH. This means if we want to convert from ETH to DAI, we need to times the amount of ETH with daiPrice. Since the variable availableBorrowsETH is in ETH unit and we want to convert it to DAI, isn't it reasonable to multiply it with daiPrice instead of 1 / daiPrice.toNumber() to get the available amount of DAI that can be borrowed? In the tutorial video, Pattrick ran the code and got 48.79 as the amount of DAI that can be borrowed. Isn't that unreasonable that we can borrow 1.65 ETH (1,209.50 USD) but only 48.79 DAI (48.79 USD)?

Please can someone clear up my confusion? I would be very thankful!

[alymurtazamemon]

@MinhUchiha001 We have cleared #2704

[Minh-Uchiha]

Oh so I am correct 🤣 I was so confused about how the above calculation was valid. Thanks so much for answering my question though!

[Jaseempk]

@alymurtazamemon even though the above doubt is cleared, I do have some other doubts also, please correct me if I got this wrong:

getDaiPrice(): returns the price of DAI in USD
availableBorrowsETH: it is the amount of ETH we can borrow in Wei
totalollateralETH:it is the total ETH collateral that we have deposited in Wei

please elaborate if I'm wrong

[alymurtazamemon]

@MinhUchiha001 @Jaseempk Sorry for the inconvenience guys, you both are right.

The actual issue is that @MinhUchiha001 thought that we are depositing 2 ETH and based on that we should get
1,998.69 DAI/ETH (as per current value). but in the tutorial, Patrick didn't deposit 2 ETH instead he deposited only 0.02 ETH which is equivalent to (48.79 DAI/ETH at the time of recording, the current value is 24.15 DAI/ETH).

It's been a long I watch the video and here forgot about the actual deposit value.

[Minh-Uchiha]

Ok so, I have been experimenting with the code for 2 hours to see why Pattrick's code works if my reasoning process is right, and I figured out that chainlink priceFeed did not return the amount of DAI equivalent to 1 ETH but returned the amount of ETH equivalent to 1 DAI. Hence, the unit should be ETH/DAI, and when inversed it's DAI/ETH, which matches up with the unit of availableBorrowsETH. Everything makes sense now!

[deep0072]

yeah it was dai per eth. but the question why we multiplied it with 0.95