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It's a common excel trick in finance. For example, let say you have $0. If you borrow $1,000,000 at 5% interest, by end of year you'll be short $50k. That means you actually needed to borrow $1,050,000. But the extra $50K causes more interest ($2,500)... so you needed to borrow $1,052,500, which causes more interest... and so on.

Instead of doing some Excel Goal Seek or Solver or VBA macro, it's nice to let the excel "reactivity" handle it for you.



Your explanation is brilliant!




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