There are many Microsoft Excel functions that are separated into different categories to make it easier to figure out which one you would like to use. In this article I will give a brief overview of how Microsoft Excel functions work. The information in this article is universal to functions in almost any programming language but I will use Microsoft Excel as example for this article.

**How Microsoft Excel functions work**

In Microsoft Excel, a function is just a call to a set of instructions that gets executed by Microsoft Excel. For example when you call the SUM function, Excel will perform the calculations based on what parameters you provide. Once the calculation is performed, the function will give you a result that you can use however you like.

These calculations will be done by calling a set of instructions that is coded into the Microsoft Excel program. Most Microsoft Excel functions exist to make it easier to perform certain tasks that are common with a spreadsheet.

**Excel functon parameters**

Parameters are what you pass into the function. Excel parameters are a way to communicate with the set of instructions and tell Microsoft Excel what values to use in the calculations. Parameters are a way to customize that call and how the function will behave and what kind of information it should operate on. For example, a SUM function takes in, as a parameter, a set of cells that contain numbers. If you pass as a parameter, the entire B column, then the SUM function knows which values to sum up (the ones in the B column). Without parameters, there would be no way to tell the function what exactly it should sum up.

**Excel function return values**

The function return value is the result of the function. After the set of instructions in the Microsoft Excel function gets executed, it will return the result. For example, the function SUM will return the sum of the numbers you passed into the parameters. If the parameters were: 1, 2, 3 then the return value of the SUM function would be 6 because that is the sum of the 3 numbers you provided in the parameters and the job of this Microsoft Excel function was to add up all the numbers you provided.

**Nested Excel functions**

The way Microsoft Excel functions operate, it is possible to nest functions. By nesting functions, I just mean that a function is passed in as a parameter. For example the above function call would have been:

*SUM(1, 2, 3)*

It is possible to make another call to the SUM function like this:

*SUM(1, 2, AVG (2, 4))*

This will give you the same result of 6. Notice how instead of all 3 parameters being numbers, we are calling another function called AVG for one of the 3 numbers, whose job is to return the average of the numbers in the parameters. So AVG (2, 4) would give us 3. The return value of the AVG function would be 3, and this 3 is used as the parameter to the SUM function. This is an example of nested Microsoft Excel functions.