1. Spreadsheet modeling is a core skill for real-world finance. Employers want individuals who both understand finance models and can implement them on a spreadsheet. Both students and employers will be delighted with any teaching effort to enhance the spreadsheet modeling skills of your students.
2. There is a major change taking place in the computing platform of business schools. Since the early ‘80’s, the standard computing platform has been desktop PC labs in the building and calculators in the classroom. In the last few years, a new platform has developed which involves: (1) requiring all students to own their own portable computers, including standard productivity software (such as spreadsheets) and (2) providing a power plug and a data jack connection to the network / Internet to every student station. According to the October 1998 issue of Business Week rating MBA programs, 12 of the top 25 schools have already adopted such a platform. I would submit all other Business Schools (both in and eventually out of the top 25) will be forced to go along in order to remain competitive. Now picture yourself walking into a classroom where every student has a portable computer and spreadsheet software right in front of them. Can you take the approach, "put away those computers — everything we do will be based on calculators"? Obviously not. This is a fundamental transformation that all faculty will be forced into, like it or not. I am suggesting that computers and spreadsheet modeling are the present and future of finance education.
3. Nearly all business students are familiar with Excel. It is virtually a universal platform. The ease with which one can manipulate values, formulas, graphs, built-in functions, the numerical Solver, and so on make it a natural platform for any quantitative discipline. It is gaining widespread use, not only in Finance, but also in Management Science, Operations Management, Business Statistics, and Accounting.

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4. Spreadsheet Modeling Exercises is based on a hands-on, active-learning paradigm. The student is asked to start with a blank spreadsheet, follow complete user-friendly instructions, and build a spreadsheet model in 30 to 60 minutes. When the student is done, the model is understood because the student built it.
5. Each exercise is a self-contained, fully-worked-out example. The standard format is: (1) a problem is defined, (2) a solution strategy is sketched, (3) Excel screen shots show what the completed spreadsheet will look like, (4) step-by-step instructions explain exactly how to build the spreadsheet, and (5) key results are discussed.
6. Each exercise contains two levels:

1. For the first time starting in Fall 1994, I built two individual spreadsheet modeling projects into my investments class. Both of these projects required every individual student to sit down at a blank spreadsheet and build an entire spreadsheet model from scratch. For many years, I had used group spreadsheet-based projects, where I could count that one or more of the members of each group would be skillful with spreadsheet programs. However this time, the really radical change was asking every individual student to build a spreadsheet model. My ex-ante concern was that, even if these projects would be wonderful for the majority of students, there might be a core of students with weak spreadsheet skills for whom these projects would be a disaster. My solution was to provide extra help. I scheduled an extra "Help Lab" session for each project in a computer lab. The idea is that any student who wanted to could drop by the computer lab, work on the project in real-time, and most likely complete the project before they left. My teaching assistant and I bounced around the lab answering questions. About half the questions were spreadsheet questions and half were finance questions. Ex-post, the Help Lab approach has worked very well. It helped all of the students to learn about the project and it provided a safety net for the students with the weakest spreadsheet skills. To further limit any downside risk, I made each project worth a reasonable, but not generous, number of points.

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2. Since this is an Electronic Book, students can have Spreadsheet Modeling Exercises open in one window and Excel open in another window. Students can:

Please send you feedback or suggestions to my e-mail address: cholden@indiana.edu. Good luck!