When you copy formulas with cell references within a row or column in Excel, the cell references in the formula automatically adjust based on their relative position. This is called relative referencing, the default behavior in Excel.

Here's how it works:

* Scenario: Imagine you have a formula in cell B2 that calculates the sum of cells A2 and B2 (`=A2+B2`).
* Copying Down: If you copy this formula down to cell B3, the cell references will adjust by one row. The new formula in B3 will become `=A3+B3`, referencing the corresponding cells in the third row.
* Copying Right: If you copy the formula from B2 to cell C2, the references will adjust by one column. The new formula in C2 will become `=A2+C2`, referencing the values in cell A2 and the copied cell C2.

This relative referencing is convenient as it allows you to quickly apply the same formula to a range of cells without manually changing each reference.

Here are some additional points to consider:

* Absolute References: You can use absolute references (e.g., `$A$2`) to lock onto specific cell locations regardless of copying. Pressing F4 after entering a cell reference toggles between relative and absolute modes.
* Mixed References: You can also create mixed references where one part is absolute (e.g., `A$2`) and the other is relative (e.g., B3). This can be useful for referencing specific cells across rows while allowing the column reference to adjust.

Understanding relative referencing is crucial for working effectively with formulas in Excel, especially when copying and applying calculations to multiple cells.