Snapping is used to precisely locate objects either in relation to the coordinate grid or to other objects. For example you can move the end point of one line close enough to the midpoint of an another one and it automatically snaps to the midpoint. A point can snap to another point, to a line or to a circle. It also snaps to the intersections of the grid lines. Snapping also comes into play when you create parallel, perpendicular and tangent lines. You can turn on/off different kind of snapping in the snapping menu.
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