1. Chapter 4
Applying Logic in Decision
Making

2. 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
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3. Chapter Introduction (continued)
• Functions covered in this chapter:
AND, IF, NOT, OR
To go to Level 1, click here
To go to Level 2, click here
To go to Level 3, click here
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4. Functions Covered in this Chapter
• AND
• IF
• NOT
• OR
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5. 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
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6. 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
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7. Sample Worksheet
D&B data includes credit
rating class, PAYDEX
score, and stress risk
class.
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8. 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
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9. Using Relational Operators
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10. Using Relational Operators
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11. 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
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12. Outcomes for the AND Function Using Two
Inputs
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13. Outcomes for the OR Function Using Two
Inputs
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14. Outcomes of the NOT Function (Single Input)
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15. Using the OR Function
to 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
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16. Using the OR Function
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17. Using the AND Function
to Evaluate Criteria
• AND (logical1,logical2,…)
• Returns a value of TRUE only if all arguments
in the function are TRUE
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18. Using the AND Function
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19. Using the AND Function
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20. Using the NOT Function
to 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
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21. Using the NOT Function
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22. 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
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23. 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
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24. Applying Conditional Formatting Based on Cell
Value
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25. Conditional Formatting
Based on Cell Value
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26. Conditional Formatting
Based on Cell Value
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27. Conditional Formatting
Based on Cell Value
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28. 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
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29. Conditional Formatting Based on the Results of
a Formula
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30. Conditional Formatting Based on the Results of
a Formula
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31. 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
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32. 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
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33. 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
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34. Writing an IF Function with a Logical Test That
Evaluates TRUE/FALSE Values
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35. Writing an IF Function with a Logical Test That
Performs a Simple Calculation
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36. Writing an IF Function with a Logical Test That
Performs a Simple Calculation
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37. Writing IF Functions
with Nested Functions
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38. Constructing
a 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
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39. Constructing
a Simple Nested IF Function
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40. Constructing
a Simple Nested IF Function
• 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.
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41. Constructing
a Simple Nested IF Function
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42. 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
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43. 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
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44. 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
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45. 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
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46. 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
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47. Using an IF Function to Combine Sets of Criteria
• Reject
• Further Evaluate
• Accept
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48. Using an IF Function to Combine Sets of Criteria
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49. Using an IF Function to Combine Sets of Criteria
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50. 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))
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51. Using the None Of Construct
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52. 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
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53. Using the Only Construct
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54. Using the Only Construct
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55. Nesting Boolean Logical Operators to Analyze
Criteria
Evaluate all parts of the
Further Evaluate criteria
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56. Completing the Complex
Nested IF Formula
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57. Completing the Complex
Nested IF Formula
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58. 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
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59. 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
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60. Chapter Summary
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