Simulation & Models : Using a Spreadsheet

Spreadsheet software can be used to create simulations of real world situations that use calculations to function :

• The numbers typed into the spreadsheet are the variables in the simulation.

• The formulae which perform the calculations are the rules of the simulation.

The calculations which are used to make a simulation in a spreadsheet are known as a model. Spreadsheets can be used to model simple or complicated financial situations :

• A company could use a spreadsheet to try and predict the effect of changing the price of one of the products it sells.

• Organisations like the treasury model mathematically the effect that changes in economic variables such as the rate of interest will have on the economy. A simple model of these effects could be produced using a spreadsheet.

GCSE ICT Companion 04 - (C) P Meakin 2004