Microsoft Office Tutorials and References
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WHAT-IF ANALYSIS
When you use a function, your purpose is often to
find out how one thing influences another. When you
use the IRR function, for example, you can find out
how a change in the loan amount, payment amount,
or payment date — or some combination of these
factors — affects the interest received. By typing in
different amounts, and payment dates, you can see
how different scenarios affect the interest rate.
What-If analysis is a systematic way of finding out
how a change in one or more variables affects a
result. Scenario Manager lets you vary one or more
inputs to find out how the result changes. The
advantage of the Scenario Manager is that it stores
a series of values so you can create a single report
or table showing how each value or combination of
values influences the result — your interest rate, in
this example. You can even present this information
as a PivotTable, with all the flexibility it offers.
2
Note: To create scenarios, you must
first enter the values required into a
worksheet and type a formula that
calculates the answer. This example
uses the IRR function, discussed in
Task #16.
3
4
1
Click and drag to select the cells
that contain the values you want
to vary.
1
2
Click the Data tab.
3
Click What-If Analysis.
A menu appears.
4
Click Scenario Manager.
l The Scenario Manager dialog
box appears.
5 Click Add.
l The Add Scenario dialog box
appears, indicating the cells
selected in Step 1.
5
6
Type a name for the scenario.
7
Click OK.
6
7
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