What is a key step in writing a nested IF function?

The key step in writing a nested IF function is to combine multiple logical tests. In Excel, the nested IF function allows you to evaluate multiple conditions sequentially. Each IF function can include its own logical test, and by nesting them, you can effectively check a series of conditions and return different values based on the results of those tests.

For instance, when constructing a nested IF function, you might write a formula that checks if a score is above a certain threshold and returns a corresponding grade. If the first condition is not met, the next nested IF would check another condition, allowing you to categorize or respond to several scenarios within one formula. This functionality is especially useful in decision-making processes where multiple outcomes are possible based on varying criteria.

The other options listed, such as creating backup copies, sorting data, and applying conditional formatting, do not directly relate to the structure and functionality of nested IF functions and are not essential in the process of constructing them.