In this Lecture we will

 Introduce the concept of "What-if Analysis"

o What-If Analysis allows you to determine the optimal values for a given situation
o For example, if you know that you can only spend a maximum of $32000 this
year on new computers, you could adjust the monthly budget amount so you
could spend the total amount by the end of the year and yet still remain within
your departments monthly budgetary constraints.
 Introduce the technique of goal seek (On Data Ribbon... What If Analysis)
o A method of performing what-if analysis in which the result is known, but the
value of a dependent variable is unknown.
o You basically arrive at a desired result by changing the value of another cell... you
find a desired value for a cell that contains a formula
 Process is ... Set Cell ... To Value ... By Changing Cell
o perform a simple goal seek example using int2.xlsx -> int2GoalSeek.xlsx
(Compound Interest Spreadsheet) ... setting balance to 40000 by changing
principle cell

 Introduce the Solver Tool

o A method of performing what-if analysis in which the result is known, but more
than a single variable variable is unknown. In addition there may be additional
constraints upon the final result.
o Solver is similar to Goal Seek except that the features and flexibility it offers is
much greater.
o Solver can modify many more cells in attempting to find the desired solution.
o You must add Solver to Excel (not on Data Ribbon by default)
 File/Options/Addins/Solver Addin
o Go through a series of scenarios
 solver1Problem.xlsx -> solver1Solution.xlsx ... basic solution changing
unit cells only
 solver2Problem.xlsx -> solver2Solution.xlsx ... integer constraint (click
add button to access constraint screen)
 make sure to uncheck "Make Unconstrained Variables Non-
Negative"
 make sure to uncheck "Ignore Integer Constraints " in Options
 solver3Problem.xlsx -> solver3Solution.xlsx ... non-neg constraint
 solver4Problem.xlsx -> solver4Solution.xlsx ... minimum value
constraint
 Provide you with an exercise to practice using the Solver