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E.g when two persons are talking together, the most common communication are 1.that's good/nice/true 2.how will you find this man/how do you know this ? IN BOTH THE SENTENCES THE SPEAKER RELATES THE PREVIOUSE MENTIONED THING/SITUATION.could you tell me when to use this and when that?

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In general, “this” refers to something in the speaker’s presence or close to the speaker, while “that” refers to something farther away from the speaker. “This man” would refer to a man “over here”, whereas “that man” would refer to a man “over there”. EDIT: just saw the title - ignore this part if you already understand this use of “this”/“that” for physical objects. But notice my use of “this”- I am referring to “this part” and “this use” because my explanation is right here and I just said it- so in this case [again, “this”] it’s almost the same concept as physical proximity. “That part” might refer to something mentioned a long time ago, or farther back in a text.

But often “this” or “that” do not refer to physical objects, e.g., Person A: “I just ate lunch”; Person B: “That’s [that is] nice”. I think “that” is more idiomatic when you are talking about some abstract concept (the fact that Person A just ate lunch). “This is nice” would probably also be acceptable to say, but might sound a little stiff or detached. Same with “how do you know that” vs. “how do you know this”- the former sounds more natural to me than the latter.

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