Microsoft Office Tutorials and References
In Depth Information
ASSIGNMENT 1: CREATING A SPREADSHEET FOR DECISION SUPPORT
￿
NPV
This value is the net present value of the investment
s cash flows, discounted using the
investment rate from the Inputs section.
￿
Was It Worth It?
The investment is worthwhile if the NPV is positive; otherwise, the
investment is not worth it.
￿
Total Cost Of Attending College
This value is the undiscounted sum of all college costs.
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Total Benefit Of Working Career
The difference between the college graduate
s salary and the
s salary is calculated for each year of a working career. This value is the
undiscounted sum of those differences.
Calculations Section
This section calculates the values shown in Figure 10-3. Values are calculated by formula, not hard-coded.
The values are then used in other calculations that follow. An explanation of the line items follows the figure.
FIGURE 10-3
Calculations section
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The expected work region is an input. Expected annual
salary and benefit increases for high school graduates are: NE, 1%; SE, 3%; SW, 4%; NW, 1%;
MID, 2%.
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Expected annual salary and benefit increases for college graduates
are: NE, 2%; SE, 4%; SW, 5%; NW, 3%; MID, 4%.
Cost of Attending College and Working Career Inflows Sections
This section is the spreadsheet body, as shown in Figure 10-4. Values shown are for illustrative purposes only.
Investment outflows are computed in the Cost of Attending College section, and investment inflows are
computed in the Working Career Inflows section. An explanation of the line items follows the figure.
FIGURE 10-4
Cost of Attending College and Working Career Inflows sections
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Tuition And Fees
Assume that the student is a high school senior and will attend college in
the following year. Thus, the Year 1 tuition and fees is the current year amount multiplied by
(1
the expected percentage
increase) multiplied by the Year 1 amount, and so on. In the example shown, the student
expects to be in college for four years, so the dashes represent zeroes in years 5 and 6. Positive
values are shown for years 5 and 6 if the student enters 5 or 6 for the number of years in
college. Thus, an IF statement is needed in the Year 5 and Year 6 cells.
the expected percentage increase). The Year 2 amount is (1
þ
þ
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Room And Board
The logic used for Tuition and Fees is applied here for room and board.
Again, IF statements are needed for the Year 5 and Year 6 cells.

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