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Chapter 9. Advanced Data Analysis and Ma... > Conducting a Sensitivity Analysis wi...

Conducting a Sensitivity Analysis with Multiple Operations

Although the command name “Multiple Operations” is not particularly descriptive, this feature enables you to do a sensitivity analysis of data in a spreadsheet. In a nutshell, a sensitivity analysis allows you to place a function (or formula in a spreadsheet) and then view the different outcomes that are provided when you vary the input to the function. For example, you could use the function PMT, which uses the rate (for a monthly payment remember to divide the rate by 12 in the function), number of payments, and the principal on a loan, to create an analysis sheet that shows you the different payment amounts at different car prices. Since a sensitivity analysis allows you to vary two variables in a function, you could also vary the term of the loan.

Figure 9.7 shows a sensitivity analysis created using the Multiple Operations feature. Two values have been made variable: the term (placed in the row above the output table) and the principal, which serves as the first column in the analysis table.


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