This document discusses goal seek and sensitivity analysis in Excel. It defines goal seek as a tool that finds an unknown value from known values to achieve a desired result. Sensitivity analysis determines how changes in inputs impact the output. The document provides examples of using goal seek to find the number of generators that must be sold to reach the break-even point. It also demonstrates sensitivity analysis by creating a data table to analyze how profit changes with different sales levels, costs, and prices.

1. Goal Seek And
Sensitivity Analysis in
Excel SUBMITTED BY- VASU ATRI
MILAN RAMESWAR PANIGRAHY

2. Introduction:-
▶ A Goal Seek is a tool that is used to find an unknown value
from a set of known values.
▶ It comes under the What-If Analysis feature of Microsoft Excel,
which is useful to find out the value that will give the desired
result as a requirement.
▶ This function instantly calculates the output when the value is
changed in the cell.
▶ You have to mention the result you want the formula to
generate and then determine the set of input values that will
generate the result.

3. Implementation:-
▶ The path for goal seek in excel is, first go to Data tab then under the
Forecast group click What-if- Analysis then choose Goal seek option.
▶ The Short-cut path for goal seek is Alt+A+W+G.

4. As shown in the figure, the Goal Seek dialog box accepts three values:
•Set Cell: It specifies the cell whose value will be changed to the
desired value after the result of the Goal Seek operation.
•To Value: It specifies the value that you want as a result of the Goal
Seek tool.
•By Changing Cell: It specifies the cell whose value needs to be
changed to achieve the desired result.

5. Examples of Goal Seek in Excel:-
▶ Example-1:-
▶ Let us take the example of multiplication between two
numbers A and B, where A=9, B=6.
▶ By using the product function, =PRODUCT(B1,B2) resulting to
54.

6. • If A is 9, what will be the second number for B to get the result, 72 ?
Following are the steps:
• Click on Data Tab
• Under Forecast Group
• Click on the What-if Analysis drop-down menu
• Click on Goal Seek
• In the Goal Seek Dialog Box, select B3 in the ‘Set Cell’
• Enter 72 in the ‘To Value’
• Select B2 in ‘By Changing Cell’

7. Then press OK
Again press
OK
• When the value of B will become 8, the product of A and B will be 72.
• Example-2
• Let us take the example of Ormax Ltd. Trading with generators. The price of each
generator is Rs 18000, and the quantity sold is 100 nos.

8. • We can see that the company is suffering a loss of 13.8 lacs. It is identified
that the maximum price for which a generator can be sold is Rs. 18000.
Now, It is required to identify the no. of generators that can be sold,
which will return the break-even value (No Profit No Loss). So the Profit
value (Revenue – Fixed Cost + Variable cost) needs to be zero to attain
break-even value.

9. Following are the steps:
• Click on Data Tab
• Under Forecast group
• Click on the What-if Analysis drop-down menu
• Click on Goal Seek
• Select C9 in the ‘ Set Cell ‘
• Enter 0 in the ‘ To Value ‘
• Select C4 in ‘ By Changing Cell ‘

10. • Then press OK in the goal seek dialog box for the result
• By the selling of 185(approx.) generators the ORMAX LTD. will reach to its
breakeven point.

11. Pros and Cons Of Goal Seek in Excel
• The Goal Seek will allow the user to find out the accurate data
by back calculating the resulting cell by giving a specific value
to it.
• Goal Seek Feature can be used with the Scenario Manager
feature.
• Data must contain a formula to work.
• Goal Seek is based on the Dependent and Independent cells.

12. Sensitivity Analysis
Introduction:-
▶ How changes in input changes the output i.e. how sensitive output is to
change in input.
▶ Whenever you give some input to a function it will give you some output .
INPUT OUTPUT

13. • For example,
There is a linear equation 3x+5=y,
Here value of ‘x’ is input and ‘y’ is the respective output.
The value of ‘y’ depends upon the value of ‘x’ ,which means whenever the
value of ‘x’ changes then the value of ‘y’ changes automatically.
If x=1, then value of y will be 8,
if x=2, then value of y will be 11 and so on.
• If multiple inputs are there for an output then the output will change on the
changing of every input which is a complex process.
INPUT
INPUT
INPUT
INPUT
OUTPUT

14. • In excel sensitivity analysis can be done with having maximum of two variables
only.
INPUT
INPUT
OUTPUT

15. Examples
▶ Following is the monthly report on operations of Tron Inc. a
Tea Bag Manufacturer

16. Profit and Loss Analysis of Tron Inc.

17. 1. One Variable Sensitivity
▶ Management is planning to increase profit and wants to know
what would be monthly profits at following sales level
assuming they are able to maintain current selling price and
cost price in future also :-

18. Process
Following are the steps :-
• Select the Data
• Click on Data Tab
• Under Forecast group
• Click on the What-if Analysis drop-down menu
• Click on Data Table
• Put Column Input Cell ‘$F$3’ as variable

19. 2. T
wo Variable Sensitivity
▶ Management wants to know what would be monthly profit at current
level of units sold and following at selling price and cost level.

20. Process
▶ Make the Cost Price and Selling Price Table
▶ Take Profit as Operator (Highlighted in Yellow)
▶ Select the table

21. ▶ Click on the Data Tab
▶ Under Forecast Group
▶ Click on the What-if Analysis drop-down menu
▶ Click on Data Table
▶ Put Row Input Cell ‘$F$5’ and Column Input Cell ‘$F$6’
▶ Then Press OK in the Data Table Dialog Box

22. Thank You!