Spreadsheet Models for Managers


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ISpreadsheet Models for Managersf you use Excel to model businesses, business processes, or business transactions, this course will change your life. You'll learn how to create tools for yourself that will amaze even you. Unrestricted use of this material is available in two ways.

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Spreadsheet Models for Managers


This reading is especially relevant for Session 2Dimensional Analysis


Dimensional analysis is a technique for designing or validating calculations involving quantities that have dimensions, or units. This page describes a technique you can use to figure out how to compute with dimensioned quantities.

Dimensioned quantities

A "dimensioned quantity" is a number with attached units. For example, your age is a dimensioned quantity — 29 years, say. Or 914544000 seconds. Expressed this way, the units of your age would be years or seconds, respectively.

Whenever we perform arithmetic with dimensioned quantities, the units must be consistent and make sense. You can use this fact to figure out what gets multiplied by what. But to do that, you have to understand the rules of arithmetic with dimensioned quantities.

Arithmetic with
dimensioned quantities

Dimensioned quantities always have two parts: the numeric part, and the unit part. The "unit" is the dimension — years or seconds in the examples above. Dimensioned quantities obey the rules of arithmetic, with a couple of modifications:

The fundamental trick

We usually have one of two problems when trying to compute with dimensioned quantities: either we're trying to add or subtract quantities that have different dimensions, or we're trying to convert from one unit to another. In the former case, the best approach is to convert one of the two quantities' units to that of the other, so in either case we have to do a conversion. The fundamental trick is: convert by multiplying by 1.

Sounds dumb, but it really is pretty clever. Let's say we want to convert kilos to ounces. There are 2.2 pounds in a kilo, and 16 ounces in a pound. How many ounces in a kilo?.

Well, 16 ounce = 1 pound. Therefore, 1 = 16 ounce/pound. And since 2.2 pound = 1 kilo,

1 kilo = 2.2 pound
 = 2.2 pound * 1
 = 2.2 pound * (16 ounce / pound)
 = 2.2 * 16 ounce = 35.2 ounce

As you can see, we can manipulate the unit names just as if they were algebraic quantities.

Examples

At the end of the fiscal year, we plan to lease the offices next door. We now have 1000 square feet of space. The space next door is an additional 800 square feet. When we lease the new space we'll have 1800 square feet.

Sounds easy enough. Viewed as dimensional quantities, we can express this as:

Total space = 1000 ft2+ 800 ft2 = 1800 ft2

If we were to double our space instead, we would multiply our current space by the "pure number" 2:

Total space = 2 * 1000 ft2 = 2000 ft2

We want to carpet the combined space. Carpeting is sold by the square yard. There are 3 feet in a yard. How much carpeting will we need?.

Total yardage = Total space = 1800 ft2 * (1 yd/3 ft)2
= 200 yd2

Here we used the fact that multiplying by 1, in the form

1 = (1 yard/3 ft)2,

doesn't change the value of the dimensioned quantity.

For more about my spreadsheet consulting and training services, visit SpreadsheetAce.com.

Last Modified: Wednesday, 22-Oct-2008 05:31:20 EDT

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