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In this video tutorial, viewers learn how to set up business letters in Microsoft Word. The first step involves changing the top margin from the default 1 inch to 2 inches. This is done by navigating to the Page Layout tab, selecting Margins, and then choosing Custom Margins to input the desired value. After adjusting the top margin, the tutorial indicates that viewers will also need to change the font style, size, and some spacing options, although specific details for these adjustments are not provided in the initial text.