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Working With Basic Random Variables in Excel

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Experience Level: Beginner
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The viewer will learn how to simulate a series of coin tosses with the rand() function and learn how to make these “tosses” depend on a predetermined probability.

Video Steps

1. Flipping Coins in Excel: Enter =RAND() into cell A2

2. Recalculate the random variable with the key combination fn+F9 (Also whenever a cell’s content is edited it recalculates)

3. Enter =IF(A2<0.5,”Heads”,”Tails”) into cell B2

4. Copy down to simulate 20 independent coin tosses

5. Enter =IF(B2=”Heads”, 1, 0) into cell C2 and copy down to C21

6. Count total and number of tosses and total number of heads (Calculate probability of heads versus the average of column C)

7. Changing the Probability: Enter 0.75 into cell E4

8. Change cell B2 to: =IF(A2<$E$4,"Heads","Tails") and copy down

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Author:Toby Reaper
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This is for people with spreadsheet skill, but not necessarily yet book-keeping skills, which with this “starter template” will give you the lists headings and a few fairly simple calculations you need to get going. 

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