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Mathematical Question - anyone good with maths!?


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Howdy!

 

I'm trying to figure out how to do an equation in EXCEL - hopefully someone here is good at maths!

 

This is a financial equation, so the top number represents value and the bottom debt.

 

Required Percentage = 33%

 

Value = 100

Debt = 40

 

Doing the equation... 40/100 = 40%

 

What I want is for EXCEL to calculate the required "Input" which reduces the debt /value ratio to 33% (adjustable to whatever is required)

 

Doing it manually...

 

Input = 10

Value = 90  (100-10)

Debt = 30    (40-10)

 

30/90 = 33%

 

So it this instance, I would enter in 33% into a field, EXCEL would look at the current Value and Debt values and calculate the answer is 10.

 

Anyone?

 

Regan

So you want to reduce both variables by the same amount, until dividing the debt by the value produces a particular percentage?

 

Well, that boils down to a fomula which you can manipulate:

 

(D-x)/(V-x) = Y    Where D is our debt, V is our value, and Y is the required fraction (e.g. for 33.3..%, Y is 0.33...)

D-x = Y(V-x)

D-x = YV-Yx

Yx-x = YV-D

x(Y-1) = YV-D

x=(YV-D)/(Y-1)

 

Plug your numbers in for Y,V and D and you'll have your x.

 

 

 

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