How to Use Goal Seek in Excel – Example 1
Determine the Rate Of Interest using a Simple Interest.
We need to calculate the rate of interest when the time period, principal amount, and simple interest are already known.
Given
Principle amount = 2000
Time = 3 Years
Simple interest = 6000
Step 1: Open MS Excel and Insert the Values
Step 2: Write the formula of Simple Interest in any one cell (B4)
Step 3: Open the Goal Seek Dialogue Box
Step 4: Choose the Simple Interest Formula Cell (B4)
In the Set Cell box select the cell which contains the formula of simple interest (B4)
Step 5: Enter 6000 (as given) in the To Value Box
In the To Value box write the resultant value of the simple interest i.e. 6000 (Given in question).
Step 6: Enter the rate of interest cell reference (B3) in the By Changing Cell
In the By Changing Cell write the reference of the cell in which you want the rate of interest value (B3).
Step 7: Click Ok
Step 8: Preview the Result
The Rate of interest value is calculated in cell (B3).
Things to Remember
- There should always be a formula in “set cell”, It can’t be empty.
- There should be dependency of “set cell” directly or indirectly on “by changing cell”. That is necessary to study the imapct on the “set cell”.
- The “by changing cell” should not contain any special characters.
Note: The formula remains the same throughout. The input values entered in the “by changing cell” box are changed to study the effect on the output.
How to use Goal Seek in Excel for What-If analysis with Examples
Goal Seek is a “What if – analysis” tool available in MS EXCEL to determine or calculate any input value based on the formula and the output/resultant value. In simple language, we can say, “What should be the input value of the given output”? The good thing about Goal Seek is that it performs all calculations behind the scenes. You are only asked to give these three parameters Set cell, To value, By changing cell.