A
ABS function, 51
Absolute value, 51
Amortization schedule
building, 124–126, 125t
updating with tax savings, 126–128, 127t
Arithmetic mean, 33–34
AVERAGE function, 33–34
B
Binomials, expanding, 5f
Bivariate quantitative variable, 92
Breakeven analysis, 99–103
Breakeven point, 101
C
Capital investment decision model, 113–118, 114t, 115t
Column chart
qualitative variable, 80–81, 80f
quantitative variable, 85–86, 85f
Combination
COMBIN function, 51–52
equation, 51
Compound interest
future value, 23–24
future value of ordinary annuity, 27–28. See FV
present value, 25–26
present value of ordinary annuity, 29–30. See PV
Cost model
average cost, 101–102, 102t, 102f
fixed vs. variable, 98–100, 99t, 99f, 100t, 101, 105, 106f
COUNT function, 35–36
COUNTIF function
nonnumeric text data, 38–39
numeric
exact values, 36
intervals of values, 37–38
using criteria, 39–40
D
Data Analysis ToolPak
installation, 69–70
interpreting results
Descriptive Statistics tool,
71–73
Histogram tool, 74–78
other analysis tools, 78–79
Rank and Percentile tool, 78
Decimals, place value, 2f
Demand curve, 103–108, 105f, 106f
Descriptive model, 97
Descriptive Statistics tool, 71–73
Distributive property of multiplication, 4–5
E
EFFECT function, 59–61
Effective interest rate
financial equations, 26–27
financial functions, 59–61
Exponents
definition, 5
executing, 5–6, 6t
F
Financial equations
compound interest
future value, 23–24
future value of ordinary annuity, 27–28. See FV
present value, 25–26
present value of ordinary annuity, 29–30. See PV
effective interest rate, 26–27
internal rate of return, 30–31, 118
net present value, 31–32, 116t, 117t
Financial functions
effective interest rate, 59–61
future value of an annuity (FV), 61–63
net present value (NPV), 63
periodic interest rate (RATE), 66–67
periodic payment (PMT), 63–64
present value of an annuity (PV), 65–66
Fixed costs, 98–100, 99t, 99f, 100t, 101, 105, 106f
FV function, 27–28, 61–63,
121–123, 122t, 123t
G
Goal Seek, 102–103
Graphics generation
line graph formation, 88–89
ogive formation, 89–91
pie charts, 83–84
qualitative data
column chart, 80–81
stacked column chart, 81–82
quantitative data
bivariate, 92
column chart, 85–86
scatterplot, 92–94
stacked column chart, 86–87
Grouped data
estimated sample mean,
13–15, 15t
estimated sample standard deviation, 16–18, 18t
H
Histogram tool
building, 74, 75f
using, 75–78
I
Inequality signs, 3t
Internal rate of return (IRR), 30–31, 118
INT function, 53
L
Law of demand, 104
Linear demand curve, 104–108
Linear trendline equation, 110–113
Line graph, 88–89, 88f, 97f, 105f
Logarithm
LN function, 53
LOG10 function, 54–55
M
Magnitude of numbers
evaluation by hand, 1–2, 2f
evaluation using Excel, 2–3
Mathematical model
characteristics, 95
definition, 95
example, 96–97, 96t, 97f
types, 97
Math & Trig functions
absolute value (ABS), 51
combination, 51–52
integer (INT), 53
logarithm, base 10, 54–55
natural logarithm (LN), 53
round, 55–56
square root (SQRT), 56–57
sum, 57–58
truncate (TRUNC), 59
MAX function, 40–41
MEDIAN function, 42–44
MIN function, 43–44
N
Natural logarithm (LN), 53
Negative numbers, multiplying, 5t
Net present value (NPV)
financial equations, 31–32, 116t, 117t
financial functions, 63
Nonnumeric text data. See COUNTIF
Normative model, 97
NPV. See Net present value
O
Ogive graphics formation, 89–91, 90f
Order of mathematical operations
parentheses, 3–5
exponents, 5–6
multiply and divide, 7
add and subtract, 7
Ordinary annuity
definition, 27
future value, 27–28. See FV
present value, 29–30. See PV
P
Parentheses, expanding, 3–5
PERCENTILE function, 44–46
Periodic interest rate (RATE), 66–67
Periodic payment (PMT), 63–64
Permutations
equation, 46
PERMUT function, 46
Personal planning
residential mortgages, amortization schedule
building, 124–126, 125t
updating with tax savings, 126–128, 127t
retirement planning
future value of stream of payments, 121–123, 122t, 123t
present value of stream of payments, 119–121, 120t
Pie chart, 83–84, 84f
PMT function, 63–64, 124–126, 125t
Pooled variance estimate, 20–21
Population standard deviation, 49
Population variance, 50
Positive numbers, multiplying, 5t
Profit function, 100–106, 100t, 101f, 106f
Predictive model, 97
PV function, 29–30, 65–66,
119–121 120t
Q
Qualitative variable
column chart, 80–81, 80f
stacked column chart, 81–82
Quantitative variable
bivariate, 92
column chart, 85–86, 85f
scatterplot, 92–94, 94f, 110f
stacked column chart, 86–87, 82f, 87f
QUARTILE function, 44, 47
R
Rank and Percentile tool, 78
RATE function, 66–67
Residential mortgages, amortization schedule
building, 124–126, 125t
updating with tax savings, 126–128, 127t
Retirement planning
future value of stream of payments into future, 121–123, 122t, 123t
present value of stream of payments into future, 119–121, 120t
Revenue function, 100–106, 100t, 101f, 106f
ROUND function, 55–56, 124–126
S
Sample mean, 8–9
Grouped data, estimate,
13–15, 15t
z-score for, 19–20
Scatterplot, 92–94, 94f, 110f
Solver, 107–108
SQRT function, 56–57
Stacked column chart
qualitative variable, 81–82, 82f
quantitative variable, 86–87, 87f
Standard deviation
grouped data, estimate, 16–18, 18t
population, 49
sample, 11–13, 47–49
Statistical equations
mean
grouped data, estimate, 13–15, 15t
sample, 8–9
standard deviation
grouped data, estimate, 16–18, 18t
sample, 11–13
t-score for two means, 21–23
variance
pooled estimate, two populations, 20–21
population, 9–11
sample, 10
z-score for sample mean, 19–20
Statistical functions
AVERAGE, 33–34
COUNT, 35–36
COUNTIF
nonnumeric text data, 38–39
numeric, exact values, 36
numeric, intervals of values, 37–38
using criteria, 39–40
MAX, 40–41
MEDIAN, 42–43
MIN, 43–44
PERCENTILE, 44–46
PERMUT, 46
QUARTILE, 44, 47
STDEV
population, 49
sample, 47–49
VAR
population, 50
sample, 49–50
SUM function, 57–58
T
Total cost, 98
TRUNC function, 59
t-score for two means, 21–23
V
Variable costs, 98–100, 99t, 99f, 100t, 101, 105, 106f
Variance
statistical equations, 9–11
statistical functions, 49–50
Z
z-score for sample mean, 19–20