Refer to the scenario described in Prob. 3.4-12 (Chap.3), but ignore the instructions given there. Focus instead on using spreadsheet modeling to address Al Ferris’s problem by doing the following.
(a) Visualize where you want to finish. What numbers will Al require? What are the decisions that need to be made? What should the objective be?
(b) Suppose that Al were to invest $20,000 each in investment A (year 1), investment B (year 2), and investment C (year 2). Calculate by hand what the ending cash position would be after each year.
(c) Make a rough sketch of a spreadsheet model, with blocks laid out for the data cells, changing cells, output cells, and objective cell.
(d) Build a spreadsheet model for years 1 through 3, and then thoroughly test the model.
(e) Expand the model to full scale, and then solve it.