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Using Excel Functions
and Formulas
Abdisalam Issa-Salwe
Faculty of Professional Studies
Thames Valley University
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Function
Using Function
Function – a predefined
computational task
Requires arguments
Values the function uses to calculate
answers
Returns a value
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Function wizard
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Statistical Functions
MAX, MIN, and AVERAGE functions
Return highest, lowest, and average
values from an argument list
Argument list may include cell references,
cell ranges, values, functions, or formulas
Cells that are empty or contain text are
not included
COUNT and COUNTA functions
COUNT returns number of cells containing
numeric entries or formulas that return a
number
COUNTA also includes cells with text
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Statistical Functions (cont…)
In general, use functions instead of
formulas
Functions are adjusted as rows or
columns are deleted or added within the
range referenced the function
With formulas
Adding a row adjusts the cell references
in the formula, but does not include the
new row in the formula
Deleting a row causes a #REF error
message
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The IF Function
Enables decision making in a
worksheet
Requires three arguments:
A condition
A value if the condition is true
A value if the condition is false
Condition must be able to be
evaluated as true or false
Uses relational operators (=, <, etc.)
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VLOOKUP function
Allows Excel to look up a value in a
table and return a related value
Requires three arguments:
the numeric value (or cell) to look up
the range of the table
the column number containing the value
you want to return
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PMT Function
PMT Function
Calculates a periodic payment, such
as a car or mortgage payment
Based on:
Amount financed
Interest rate
Number of periods
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Using PMT function
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Goal Seek
The Goal Seek Command
Allows you to set an end result and vary
the inputs (assumptions) to produce that
result
Only one input can be varied at a time
All other assumptions remain constant
For example, set a desired monthly car
payment
Vary the amount financed
Interest rate and number of months remain
the same
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Using Goal Seek
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Use a what-if analysis
Suppose you think that it might be better for
the students if you limited the enrolment to
40. How would you calculate the net income?
On the spreadsheet that you have set up to
figure the profits, change the number of
students from 60 to 40, and recalculate.
The spreadsheet will show a net income of
$5000.
Thus, at only 40 students, the school would
lose $5,000 per month.
This process of changing the value of a
variable in a calculation to see how the new
answer compares with the old answer is called
a what-if analysis.
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Data tables
Data tables are part of a suite of
commands sometimes called what-if
analysis tools.
A data table is a range of cells that shows
how changing certain values in your
formulas affects the results of the
formulas.
Data tables provide a shortcut for
calculating multiple versions in one
operation and a way to view and compare
the results of all of the different variations
together on your worksheet.
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Data tables (cont…)
Use a one-variable data table if you
want to see how different interest
rates affect a monthly mortgage
payment.
In the following example, cell D2
contains the payment formula,
=PMT(B3/12,B4,-B5), which refers
to the input cell B3.
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Two-variable data tables
A two-variable data table can show
how different interest rates and loan
terms will affect the mortgage
payment.
In the following example, cell C2
contains the payment formula,
=PMT(B3/12,B4,-B5), which uses
two input cells, B3 and B4.
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Data tables recalculate whenever a
worksheet is recalculated, even if
they have not changed.
To speed up calculation of a
worksheet that contains a data
table, you can change the
Calculation options to automatically
recalculate the worksheet but not
data tables.
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Use two-variable data tables to
perform a what-if analysis
Excel provides the capability to create two-variable data
tables, which allow two input variables, and one result
variable.
The data table will have the values for one input
variable across the top row of the table, and the
values for the other input variable down the first
column
Excel can create a data table that will display the net
income based on different tuition values and different
student counts.
As with a one-variable data table, to create a two-
variable data table in Excel, you must first create a
spreadsheet that calculates net income based on the
number of students and the amount of tuition
Once the spreadsheet is set up, you can create the
two-variable data table
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Create a graph for a two-variable table
Just as Excel can create a graph of a one-
variable data table, it can also create a
graph of a two-variable data table.
To do this, select the entire table.
From the Insert menu, click Chart. Choose
XY (Scatter) and Scatter with data points
connected by lines without markers.
Follow the instructions on the Chart dialog
boxes to label the graph and the axes.
Tell Excel to put the graph on a new sheet.
When you click Finish, Excel will display a
graph of the data table, with a different line
for each of the rafting fees, using the
example table from the previous slide.
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A CCP chart for a two-variable data table
This figure shows a CVP
chart for the two-
variable data table
shown in a previous
slide. Note that it creates
a separate line for each
rafting fee in the table.
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Create and use array formulas
For example, using the Excel function SUM, you
could create the array formula =SUM(B3:B12*C2).
To ask Excel to treat this as an array formula, press
and hold the Ctrl key and the Shift key while you
press the Enter key (rather than just using the
Enter key to enter the formula into the cell).
This will cause Excel to put brackets around the
formula, so that it looks like this:
{=SUM(B3:B12*C12)}.
Don't try to type in the brackets themselves; if
you do, Excel will treat the formula as text
Excel will interpret the formula
{=SUM(B3:B12*C12)} as a command to multiply
each of the values in B3:B12 by the value in C12,
and calculate the sum of the values.
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Create formulas using multiple arrays
Another example of an array formula using
SUM is {=SUM(B3:B12*C3:C12)}.
Using this formula, Excel will multiply the
first element in the first array by the first
element in the second array, the second
element of the first array by the second
element of the second array, and so on,
pair-wise through both arrays.
The two arrays must be the same size; if
not, Excel returns an error message.
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Functions can display multiple values
A few of the functions in Excel can
display multiple values when given
array arguments.
Some examples are TABLE and
TREND.
Formulas that display several values
must be entered into a range of
cells that has the same number of
rows and columns as the input
array arguments have.
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An example of Excel’s Trend function
This figure shows a range of values displayed by the Excel function TREND.
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Create scenarios to perform what-if analyses
To perform what-if analyses with more
than two input variables, you have to use
scenarios, which are:
A set of values that Excel can put into a
worksheet
Created based on existing spreadsheets in
Excel
You use the Scenario Manager to set up
and view different scenarios.
Once you have the spread sheet with one
set of values, you can create several
scenarios with different values.
As you view each scenario, Excel uses the
values in the scenario as input to
calculate the results.
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Use the Scenario Manager dialog box
To invoke the Scenario Manager and begin
creating scenarios, start the Scenario Manager by
choosing Scenarios from the Tools menu.
In the Scenario Manager dialog box, click the Add
button, and enter a name for the scenario.
Enter the name for your first case, such as
Normal Case.
Type in the reference to each of the cells that are
going to change during the scenarios.
When you click OK, the Scenario Manager will
prompt you for a set of values, one for each of
the cells whose references you entered as
changing cells.
The original values will be entered. Since this is
the original case, you can accept these values.
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The Scenario Manager dialog box
This figure shows the Scenario
Manager dialog box. Clicking
theAdd button opens the next
dialog box where you specify
the name and specify the cells
that will change.
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Add additional scenarios
This figure shows the
ScenarioValues dialog
box. When you click the
Add button, you will be
prompted to enter a name
and a set of values for the
next scenario.
Enter the name and replace the original values with the values for this case.
Continue in this way until you have all of the cases entered.
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View and edit scenarios
When you have the scenarios defined, you can
view each one by selecting the name of the
scenario you want to see in the Scenario
Manager dialog box.
After you have selected the name, click Show
and then Close.
Excel will display the original spreadsheet, with
the values from the scenario you chose.
You can edit your scenarios from the Scenario
Manager
Select the scenario you want to edit, and click
Edit
This will bring up a dialog box in which you
can change any of the input values
You can then display the spreadsheet with the
values from the edited scenario
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Create a scenario summary report
Using the Scenario Manager, you can
display a summary of the results from
all of the scenarios you have created.
This data can be displayed in a
summary table or a PivotTable.
To create a summary table based on
the scenarios you have created, open
the Scenario Manager.
In the Scenario Manager dialog box,
click Summary to view the Summary
dialog box.
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The Scenario Summary dialog box
This figure shows the
Scenario Summary dialog
box. Choose Scenario
summary. Then, in the Result
cells: box, enter the
references for the cells where
the results you are interested
in are.
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A Scenario Summary report
When you click OK in the Scenario Summary dialog box, a Scenario Summary,
like the one in this figure is created. Excel displays the values from all of the
changing cells, along with the values from the result cells you chose.
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Create a PivotTable report and chart
To create a Scenario PivotTable report:
Open the Scenario Manager dialog box and click
Summary
From the Scenario Summary dialog box, choose
Scenario PivotTable report
Excel will create a Scenario PivotTable report for
all of the scenarios you have created
Excel can also chart the PivotTable. To do
so:
Click on the Chart Wizard from the PivotTable
tool
From the Menu bar, choose Chart and select the
type of chart you want
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An example of a PivotTable report
This figure shows a
Scenario PivotTable
report.
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An example of a PivotTable chart
This figure shows a
Scenario PivotTable
Clustered Column
Chart.
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Use the PMT function to calculate the
payment of a car loan or mortgage.
Use the FV function to determine the
future value of a retirement account
Explain how the Goal Seek command
facilitates the decision-making process
Use mixed references to vary two
parameters in a table
Use the AVERAGE, MAX, MIN and COUNT
function
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