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In this video tutorial, viewers learn to set up business letters in Microsoft Word. The first step is adjusting the top margin from 1 inch to 2 inches by accessing the Page Layout tab, selecting Margins, and choosing Custom Margins to input the new value. After pressing OK, the cursor will shift to reflect the new 2-inch top margin. The next task involves changing the font style, size, and spacing options, which will be covered in the following steps.