Deck 2: Introduction to Electronic Spreadsheets

Question 1

Give two benefits of using spreadsheets in doing financial analysis.

Answer 1

Compared to manual calculations, spreadsheets are 1) faster for performing calculations; 2) less likely to have a computational error; 3) recompute changes faster and more accurately.

Question 2

Suppose you wanted to add together the numbers in cells A1, A2, and A3. Write three versions of the Excel formula you would type to perform this calculation.

Answer 2

=SUM(A1, A2, A3) or =A1+A2+A3 or =SUM(A1:A3)

Question 3

If you typed the following formula into Excel, what number would it generate?
=(15/3)+5*(6/2)

Answer 3

Excel would first divide the (15/3) and (6/2), then multiply the (6/2) by 5, and then add this with the (15/3), or
=5 + 5 × 3 = 20