What If Analysis

What-if Analysis in Excel

• It is a process of changing cells' values to see how

those changes will affect the worksheet's outcome.
• You can use several different sets of values to explore
all the different results in one or more formulas.
• What-if Excel is used to make better, faster and more
accurate decisions based on data.
– You can propose different budgets based on revenue.
– You can predict the future values based on the given
historical values.
– If you expect a certain value due to a formula, you can find
different sets of input values that produce the desired
result.
What-if Analysis in Excel
 What-if analysis tools
• Scenario Manager
• Goal Seek
• Data Tables
 1. Scenario Manager
• A scenario is a set of values that Excel saves and can substitute
automatically in cells on a worksheet.
• Scenario Manager is a dialog box that allows you to save the values
as a scenario and name the scenario.
• You can create and save different groups of values on a worksheet
and then switch to any of these new scenarios to view different
results.
• A scenario can have multiple variables, but it can accommodate
only up to 32 values.
• You can also create a scenario summary report, which combines all
the scenarios on one worksheet. For example, you can create
several different budget scenarios that compare various possible
income levels and expenses, and then create a report that lets you
compare the scenarios side-by-side.
 2. Goal Seek
• Goal Seek is useful if you want to know the
formula's result but unsure what input value
the formula needs to get that result.
• For example, if you want to borrow a loan and
know the loan amount, tenure of loan and the
EMI that you can pay, you can use Goal Seek
to find the interest rate at which you can avail
of the loan.
 3. Data Table
• A Data Table is a range of cells where you can
change values in some of the cells and answer
different answers to a problem.
• For example, you might want to know how
much loan you can afford for a home by
analyzing different loan amounts and interest
rates. You can put these different values and
the PMT function in a Data Table and get the
desired result.
 Example
• Assume you own a book store and have 100 books in
storage. You sell a certain % for the highest price of $50 and
a certain % for the lower price of $20.
 Create Different Scenarios

1. On the Data tab, in the Forecast group, click What-If

Analysis.
2. Click Scenario Manager.
3. Add a scenario by clicking on Add.
4. Type a name (60% highest), select cell C4 (% sold for
the highest price) for the Changing cells and click on
OK.
5. Enter the corresponding value 0.6 and click on OK
again.
6. Next, add 4 other scenarios (70%, 80%, 90% and
100%).
 Scenario Summary

1. Click the Summary button in the Scenario Manager.

2. Next, select cell D10 (total profit) for the result cell and click on
OK.
 Goal Seek

1. On the Data tab, in the Forecast group, click What-If

Analysis.
2. Click Goal Seek.
3. Select cell D10.
4. Click in the 'To value' box and type 4700.
5. Click in the 'By changing cell' box and select cell C4.
6. Click OK.
 One Variable Data Table

1. Select cell B12 and type =D10 (refer to the total

profit cell).
2. Type the different percentages in column A.
3. Select the range A12:B17.
4. On the Data tab, in the Forecast group, click
What-If Analysis.
5. Click Data Table.
6. Click in the 'Column input cell' box (the
percentages are in a column) and select cell C4.
7. Click OK.
Result: One Variable Data Table
 Two Variable Data Table

1. Select cell A12 and type =D10 (refer to the total profit cell).
2. Type the different unit profits (highest price) in row 12.
3. Type the different percentages in column A.
4. Select the range A12:D17.
 Two Variable Data Table
5. On the Data tab, in the Forecast group, click
What-If Analysis.
6. Click Data Table.
7. Click in the 'Row input cell' box (the unit
profits are in a row) and select cell D7.
8. Click in the 'Column input cell' box (the
percentages are in a column) and select cell
C4.
9. Click OK.
Result: Two Variable Data Table