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This tutorial explains how to insert and modify drop-down lists in Microsoft Word, similar to those found on the web. A drop-down list is a tool that restricts and controls user input to predefined options, making it useful for creating custom surveys and managing user responses. To create a drop-down list, the tutorial suggests enabling the Developer tab in the ribbon by accessing the file menu and selecting options. The example provided involves conducting a survey about users' office preferences, allowing them to choose from a list indicating which office table they use and how often. The video guides viewers through the process of setting up the list from scratch.