Math Equations & Their Use

Case Maths
New answer on Sep 21, 2020
3 Answers
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Anonymous A asked on Sep 20, 2020

Hello, I want to ask bout all of the mathematical equations I need to know off for the cases, such as NPV, Breakeven, and so on...

1- Can someone list them for me? every resource I find states different equations

2- What are their exact equations (forms) I need to use? since the ones used in cases might be a simplified version of the real ones

3- Can someone provide when to use each one in cases? for exact I might know what an NPV equation is but when should I use it?

Thank you!

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Clara
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replied on Sep 21, 2020
McKinsey | Awarded professor at Master in Management @ IE | MBA at MIT |+180 students coached | Integrated FIT Guide aut

Hello!

Altought there are some classic responses here (Interest rates calculations, compound margin, NPV, etc.), truth is that in 99% of the cases is not going to be anything more complicated than break-even analysis.

Hope it helps!

Best,

Clara

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Vlad
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replied on Sep 20, 2020
McKinsey / Accenture Alum / Got all BIG3 offers / Harvard Business School

Hi,

Here is a set of things you need to know:

1) Math and formulas:

  • Interest rates calculations
  • Compound margin
  • NPV using the Rule of 72, Perpetuity
  • CAGR using the Rule of 72
  • Currencies exchange calculations
  • Speed, time, distance calculations
  • Equations, systems of equations
  • Ratio & Proportions
  • Little's Law
  • Solving the problems by calculating the area of the triangle
  • Profit / breakeven formula
  • Correlations, outliers (being able to spot on the graphs, tables)

2) Fast math skills

  • Rounding up and down
  • Learn how to multiply double digit numbers (https://www.youtube.com/watch?v=6ndkkPZYJHo)
  • Learn the division table up to 1/11 (i.e. 5/6 = 83.3)
  • Learn how to work with zeros using powers (e.g.: 4000000 = 4*10ˆ6)

Use math tools (Mimir math for iOS), Math tool on Viktor Cheng website to practice

3) Working with tables and graphs and deriving conclusions

  • Study "Say it with Charts" book
  • Check all available MBB presentations and publications. Practice to derive conclusions and check yourself with the actual ones from the article / presentation
  • GMAT IR part (Official guide and Manhattan prep)
  • Learn basic statistics (Any GMAT or MBA prep guides)

Good luck!

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Ian
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updated an answer on Sep 21, 2020
MBB | 100% personal interview success rate (8/8) and 95% candidate success rate | Personalized interview prep

Hi there,

1 - Key equations to know

Honestly, you're going to find this for every single question you ask regarding casing. That's because the world of casing is vast! moreso than memorizing everything, you need to learn to react to things you don't know!

That being said, the most common equations are:

  • NPV - annuity
  • NPV - perpetuity
  • Breakeven (across a range of scenarios)
  • % change
  • ROI
  • Margin
  • Markup
  • Inventory Turnover
  • Throughput

2 - Exact formulas

Google is your friend here. Honestly, if you google and research the equations, you're going to learn them much more effectively. We can't just list every formula here for you.

3 - When to use

I'm sorry, but this is also a huge question! We can't really answer this in one go here nor should we. I highly recommend you simply go down the list provided, and test your knowledge of them in cases.

Additionally, hire a coach! 1 session will do wonders in terms of your knowledge of these questions.

(edited)

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Clara gave the best answer

Clara

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