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The YouTube tutorial explains how to annotate on a PDF using a Chromebook. By opening the file in the My Files application or Google Drive, you can use a stylus or finger to annotate on the document. This allows you to draw, illustrate, and display work easily. You can customize the pen type and line thickness for annotations. After making changes, you can save the annotated PDF. The tutorial emphasizes the convenience of this built-in feature for Chromebook users.