Local variables are most often used with Assignment functions, which can assign expressions to local variables that are used in a complex equation. (For details, see Assignment Functions in Formula Functions Reference.) This technique can sometimes simplify building an equation and improve the efficiency of its evaluation.
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In the middle pane of the Formula Editor, select Local Variables from the list.
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Click New Local.
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Enter a name for the local variable. By default, local variables have the names t0, t1, and so on, and have missing values.
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You can also create a local variable from an expression. Right-click the expression in the Formula Editor and select Create Local Variable from Expression.
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See Use Local Variables in a Formula, for an example of referencing local variables in a formula.