Chapter.04

Applying Logic in Decision Making

Chapter 4

Chapter Introduction

• Tools that allow comparison of data as well as analysis of sets of data using multiple criteria

• Boolean logical values (TRUE and FALSE)• Boolean logical functions (AND, OR, and NOT)• Specifying different cell formats based on

whether a set of criteria is met• Application of different outcomes to results of

logical tests that are TRUE versus those that are FALSE

Succeeding in Business with Microsoft Excel 2010 2

Chapter Introduction (continued)

• Functions covered in this chapter: AND, IF, NOT, OR

To go to Level 1, click hereTo go to Level 2, click hereTo go to Level 3, click here

Functions Covered in this Chapter

• AND• IF• NOT• OR

Level 1 Objectives:Analyzing Data Using Relational Operators & Boolean Logical

Functions

• Understand the Boolean logical values TRUE and FALSE

• Build formulas with relational operators• Evaluate criteria using the Boolean logical

functions AND, OR, and NOT• Apply conditional formatting to highlight key

information in a worksheet

Reviewing Financial Criteria Related to Credit

• Dun & Bradstreet® (D&B)– Widely used financial reporting services– Provides financial information about corporations

and institutions and extensive analyses on each company’s creditworthiness and payment history (PAYDEX® index)

• Create formulas by applying several credit approval indicator rules to each customer’s data

Succeeding in Business with Microsoft Excel 2010 6Level 1 home

Sample Worksheet

D&B data includes credit rating class, PAYDEX score, and stress risk class.

Using Relational Operators to Compare Two Values

• To determine if the relational expression is TRUE or FALSE

• Can be used to compare– Two values– Text labels– Dates

Using Relational Operators

Using Boolean Logical Functions to Evaluate a List of Values and Determine a Single True or False Value

AND Used to determine if all arguments are TRUE

OR Used to determine if either argument is TRUE

NOT Evaluates only one logical argument to determine if it is FALSE

Outcomes for the AND Function Using Two Inputs

Outcomes for the OR Function Using Two Inputs

Outcomes of the NOT Function (Single Input)

Using the OR Functionto Evaluate Criteria

• OR (logical1,logical2,….)• Returns a value of TRUE if either criteria is met• Returns a value of FALSE only if all arguments

in the function are FALSE

Using the OR Function

Using the AND Functionto Evaluate Criteria

• AND (logical1,logical2,…)• Returns a value of TRUE only if all arguments

in the function are TRUE

Using the AND Function

Using the NOT Functionto Evaluate Criteria

• NOT (logical1)• Takes only one argument and changes a single

TRUE value to FALSE or vice versa– NOT(TRUE) returns the value of FALSE– NOT(FALSE) returns the value of TRUE

Using the NOT Function

Applying Conditional Formatting to a Worksheet

• Identifies a set of conditions and specifies formatting of a cell if those conditions are met

• Criteria can be specified based on:– Value in the cell being formatted– Results of a specified formula that returns a

Boolean value

Applying Conditional Formatting Based on Cell Value

• Select cell or cell range to be formatted• Click Conditional Formatting button arrow in

Styles group on Home tab• Select Data Bars, Color Scales, or Icon Sets

from the menu to open a gallery of options• Point to a format to preview it in the selected

cells, and click the desired format to apply it

Applying Conditional Formatting Based on Cell Value

Conditional FormattingBased on Cell Value

Applying Conditional Formatting Based on the Results of a Formula

• Highlight a single row as the range• Specify two separate conditions based on two

different formulas

Conditional Formatting Based on the Results of a Formula

Level 1 Summary

• Tools that allow you to evaluate and compare both text and numeric data– Relational operators (>,<,>=, <=, =, <>)– Boolean logical functions (AND, OR, and NOT)

• Both relational operators and Boolean functions return a Boolean logical value, TRUE or FALSE

• Using the Conditional Formatting tool

Level 2 Objectives:Analyzing Data Using IF Functions and Nested

Functions

• Understand how to build formulas with nested functions

• Write IF functions to evaluate TRUE/FALSE values and perform calculations

• Nest functions within an IF statement• Construct a simple nested IF function

Introduction to IF Functions and Nested Functions

• IF function– Boolean logical function that returns different values (TRUE or

FALSE) depending on how the specified condition evaluates– =IF(logical_test,value_if_true,value_if_false)

• Nested function (permitted by IF function)– Contains additional formulas and/or functions as one or more

of its arguments• Provides flexibility of choosing between two different sets

of criteria, and up to seven different levels of logical tests

Writing an IF Function with a Logical Test That Evaluates TRUE/FALSE Values

Writing an IF Function with a Logical Test That Performs a Simple Calculation

Writing IF Functionswith Nested Functions

Constructinga Simple Nested IF Function

Nesting IF functions, one inside the other, allows you to ask a question, then another question depending on the outcome of the first question, and so on

• An IF function can be used to evaluate a logical test.

• However, if the logical test results in a FALSE value, another calculation is needed.

Order of Logical Tests

• Must match established criteria for non-mutually exclusive criteria

• Can be placed in any order for mutually exclusive criteria

• Using a specific order can save considerable amount of work for criteria between a range of values

Order of Logical Tests

• Order of logical tests for non-mutually exclusive criteria

• Order of logical tests for mutually exclusive criteria

• Order of logical tests for criteria between a range of values

Level 2 Summary

• Applying Boolean logic within an IF statement• IF function allows you to determine if an

expression is TRUE or FALSE, and to return a value other than TRUE or FALSE (e.g., text or numeric values)

• Additional IF statements and other Excel functions can be nested within an IF function

Level 3 Objectives:Creating Complex Logical Constructs for Solving

Problems

• Combine sets of criteria in an IF function• Create a none of construct to perform a logical

test• Create an only construct to perform a logical

test• Solve more complex problems using nested IFs

and Boolean logical functions

Evaluating More Complex Criteria

• Techniques to create more complex logical constructs (combinations of multiple logical operations) to determine if none of the criteria are TRUE for a list of items, even if only certain criteria are TRUE for a list of items

• By nesting levels of IF functions, multiple sets of criteria can be sequentially analyzed until a final value is returned

Using an IF Function to Combine Sets of Criteria

• Reject• Further Evaluate• Accept

Using the None Of Construct

• Evaluates if none of the rules are met• Combines two steps into one by nesting the

formula• Example: =NOT(OR(K3:K21))

Using the None Of Construct

Using the Only Construct

• Determines if only Rule #1 evaluates to TRUE, and, if so, to recommend further evaluation; OR if only Rule #2 and/or Rule #3 evaluates to TRUE and not Rule #1

• Always has a positive condition to be evaluated AND a negative condition to be evaluated– An OR function is required for either the positive

condition or the negative condition if more than one item being evaluated falls in that category

Nesting Boolean Logical Operators to Analyze Criteria

Evaluate all parts of the Further Evaluate criteria

Completing the ComplexNested IF Formula

Level 3 Summary

• More complex logical constructs– “None of” construct– “Only” construct

• Combining constructs to solve more complex logical tasks, nesting IF functions, relational operators, and Boolean functions within the same formula

Chapter Summary

• Relational operators (>, <, >=, <=, =, <>) and the Boolean logical functions AND, OR, and NOT allow you to evaluate and compare both text and numeric data.

• Applying Boolean logic with an IF statement– TRUE/FALSE

• Complex logical constructs– None of– Only

Chapter Summary

Chapter.04

Education

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