On personal computers, a financial modeling package resembles a spreadsheet but supports larger datasets and includes a built-in "goal seeking" function to back-solve inputs for a desired output value. Which term correctly completes this description?

Difficulty: Easy

Correct Answer: goal

Explanation:


Introduction / Context:
Financial modeling tools extend spreadsheets by adding sensitivity analysis, scenario management, and optimization helpers. A classic capability is "goal seeking," where the software iteratively adjusts an input to achieve a specified output (for example, finding the interest rate that yields a given Net Present Value).


Given Data / Assumptions:

  • The package operates like a spreadsheet but at larger scale.
  • It includes a built-in function that solves for an input given a desired output.
  • The conventional name of that function is widely used across tools.


Concept / Approach:

Goal seek automates reverse calculation. Instead of trial-and-error, the tool iteratively updates a chosen variable to minimize the difference between a formula’s result and the target value. This is distinct from generic planning or aiming; it is a named feature in many spreadsheet and modeling systems and is specifically called "goal seek" or "goal seeking."


Step-by-Step Solution:

Identify the capability: back-solve an input for a desired formula result.Recall the industry term: goal seek.Choose the word that precisely names the function: "goal."


Verification / Alternative check:

Common office suites document this feature as Goal Seek; financial modeling platforms adopt the same naming convention.


Why Other Options Are Wrong:

Target/aim/plan: Related concepts but not the established function name.

None of the above: Incorrect because "goal" is the conventional term.


Common Pitfalls:

Confusing goal seek with solver optimization; goal seek handles a single variable and single target, whereas solver can handle multi-variable constraints.


Final Answer:

goal

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