What is a defining characteristic of formulas in Excel?

Formulas in Excel perform some kind of calculation, which is a fundamental characteristic that defines their purpose and functionality. When you create a formula in Excel, you typically use operators such as addition, subtraction, multiplication, and division to manipulate values from various cells or to compute constant values. These calculations can range from simple arithmetic operations to complex statistical analyses, allowing users to derive new information from existing data.

Additionally, formulas often reference multiple cells or ranges, providing dynamic results that update automatically when the referenced data changes. The ability to perform various calculations using different types of operators is what makes Excel an effective tool for data analysis and financial modeling. This characteristic distinguishes formulas from other types of data input in Excel, which may not necessarily involve calculations at all.