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The tutorial demonstrates how to create a multi-level list in Microsoft Word. The instructor types out information on canines, felines, and tigers, then adds a paragraph for Sumatran and Siberian tigers. To create the multi-level list, they select the text and click on the "multi-level list" button in the paragraph group, choosing the desired format. Initially, all paragraphs are numbered, but by selecting a specific format, the list can be customized.