Final answer:
A circular reference is the item that means a formula cannot perform its function in Excel, as it induces a formula to refer to its own cell, creating an endless loop that cannot be resolved.
Step-by-step explanation:
The item that means a formula cannot perform its function in Excel is a circular reference. A circular reference occurs when a formula refers back to its own cell, either directly or through a chain of references involving other cells. An example could be a cell A1 containing the formula =A1+1, which is impossible to calculate because it would require the value of A1 to compute the value of A1. This is different from a syntax error, which happens when the formula is structured incorrectly, an invalid cell reference, which arises when a cell reference does not point to a cell, and missing parenthesis, which could lead to a different calculation than intended but doesn't necessarily stop the formula from working.