Exploring Economic Models Using Excel

This paper applies spreadsheet software to intermediate-level consumer theory concepts. Spreadsheets help make the concepts more accessible while allowing students to explore the ideas in more depth. Areas of application are utility functions, income and substitution effects, price indices, measures of welfare change, and the optimal saving rate. We chose the examples to stimulate awareness and discussion of the many classroom uses for four important Excel spreadsheet tools: three-dimensional (3-D) graphs, iteration, Goal Seek, and Solver.