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The tutorial explains how to insert and link pictures in a document. After embedding a picture, you can link to it by selecting it, clicking on the link checkbox, and inserting the file from the document. By checking the link checkbox, you keep the link to the picture. To view the linked picture, right-click on the graphic and go to the picture tab. Closing the document and reopening it will show the changes made to the linked picture. This process allows for easy access and management of external images in the document.