It's for a Nested Function.

Enter this function in cell B1 and then use the fill in handle to copy
the function down through cell B7. Enter the following data in the
cells in the range A1:A7 and then write down the results in cells B1
through B7 for each set.

Set 1: A1=IL; A2=IN; A3=IN; A4=OH; A5=IN; A6=OH; A7=IN
Set 2: A1=WI; A2=KY; A3=IN; A4=IL; A5=IN; A6=IN; A7=OH

not sure how nested functions work, if someone could tell me how to do
this one i should be ok to figure it out from here. thanks