From the course: Excel: Financial Modeling with Dynamic Arrays

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Building scenarios

Building scenarios - Microsoft Excel Tutorial

From the course: Excel: Financial Modeling with Dynamic Arrays

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Building scenarios

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- Let's jump into Excel now and look at an example of building a manual scenario analysis with the data validation dropdown box. So in this example, we are calculating the profitability of developing some land. We've got some assumptions here. It's $1,500 cost per square meter. Our sale price is $3,000 per square meter. We've got an assumption of 5,000 square meters and a sales commission of 2.5%. Now these two inputs are not expected to change, and we're going to perform scenario analysis on these two here because we think that they might go up and down just a little bit. So we are going to base all of our calculations on this row here, and then we'll apply our scenarios at the end. So we'll start with our calculations. So to calculate our income, we'll just say it's going to be $3,000 times the number of square meters. So that's 15 million. Our building costs, so we already have a couple of inputs there. The costs are 1,500 times the 5,000. And then we have our sales commission…

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