OK, if we just take the first part of the formula, you'll see:
=500*(C2>2.5)
The (C2>2.5) is a true/false test that, in a formula like this, returns 1 if true and 0 if false. If C2 is greater than 2.5, (C2>2.5) returns 1, which becomes 500*1, which equals 500. If C2 is not greater than 2.5, (C2>2.5) returns 0, which becomes 500*0, which equals 0.

The overall formula is just a sequence of the above expressions, each one adding to the total of whatever has already been returned. So, since 3.2, for example, in C2 is greater than both 2.5 and 3, you get 500 for (C2>2.5), plus another 500 for (C2>3), which equals the required 1000 for (C2>3).

__________________
Cheers,
Paul Edstein
[Fmr MS MVP - Word]