Microsoft Office Tutorials and References
In Depth Information
Two-Way Table
FIGURE 17.5 Click on the Original Rate in B5
FIGURE 17.6 The Original Value Row Gives the Same Results as the Original Model
WHAT happens to payments,
total payments, and so on, IF the interest rate changes?
The function argument can be interpreted as
This is why we call it
what-
if
analysis.
This will result in the desired sensitivity analysis table of Figure 17.6. Note how
the row that belongs to the rate of 8 percent matches the results of the original
model.
You may repeat this process with different input variables and create other
sensitivity analysis tables; for example, you could check the output when the number
of years changes as you see in Figure 17.7. The results are shown in Figure 17.8.
TWO-WAY TABLE
In the tables above, you saw how you can vary one of the inputs in the column,
(interest rate, the number of years, or the price) and view, in the table, the impact of
these input changes on the outcome. (This is the sensitivity analysis or the what-if
analysis.)
It is also possible to vary two inputs and view their impact on one output. This is
called a two-way sensitivity table. For the following example, I will vary two inputs:
 
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