How To Understand What-If Analysis In Microsoft Excel

A what-if scenario is fairly easy to understand – put simply, your question is, “If this happens, what happens to my numbers, or bottom line? In other words, if we do $20,000 worth of sales over the next few months, how much profit will we show?” At its basest form, this is what What-If Analysis is designed to do – projections.

As with most everything else in Excel, this feature is robust. It allows you to perform everything from relatively simple What-If projections to highly sophisticated scenarios. And, as is usually the case with Excel features, there’s no way I can cover all the possibilities in this short tutorial.

Instead, we’ll look at the basics today, and I’ll provide you with a few relatively easy What-If concepts to get you started.

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