Solving dynamic optimization problems on a personal computer using an electronic spreadsheet

Powerful desk top computers of today combined with the easy to manipulate electronic spreadsheet programs (e.g. Lotus 1-2-3) are being used quite extensively in business applications such as planning, forecasting and accounting. Currently we are also witnessing a proliferation of optimization/operations research related software which can solve reasonable size nonlinear programs (e.g. Eureka: The Solver), linear and integer programming problems (e.g. LINDO), etc. on the IBM-PC microcomputer. Despite the availability of these packages, there seems to be a lack of software for solving dynamic optimization problems, i.e. dynamic programming (DP) and optimal control. The purpose of this paper is to show how easily the Lotus 1-2-3 electronic spreadsheet program can be used to solve discrete state and discrete stage dynamic programs, and discrete time linear quadratic tracking control problems on an IBM-PC.