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Chapter 2. Analyzing Data with Excel > Solving Complex Problems with Solver

Solving Complex Problems with Solver

Most problems in business aren’t as easy as the Goal Seek examples. You’ll usually face formulas with at least two and sometimes dozens of variables. Often a problem will have more than one solution, and your challenge will be to find the optimal solution (that is, the one that maximizes profit, or minimizes costs, or matches other criteria). For these bigger challenges, you need a more muscular tool. Excel has just the answer: Solver. Solver is a sophisticated optimization program that enables you to find the solutions to complex problems that would otherwise require high-level mathematical analysis.

Solver, like Goal Seek, uses an iterative method to perform its magic. This means that Solver tries a solution, analyzes the results, tries another solution, and so on. However, this cyclic iteration isn’t just guesswork on Solver’s part. The program looks at how the results change with each new iteration and, through some sophisticated mathematical trickery, it can tell (usually) in what direction it should head for the solution.


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