Is there a specific rule about when to use the word "this" or the word "that"? I have heard people say "this clock", and I have also heard people use it in the context "this city". Overall, I'm very confused.
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I found this quote here by Michael Swan (Practical English Usage), and he says (page 589): "We use this/these for people and things which are close to the speaker. We use that/those for people and things which are more distant from speaker, or not present."
Furthermore, in the book "English Grammar Today" (Cambridge) we can read: "We sometimes use this, these, that, those to identify emotional distance. We use this and these to refer to things that we feel positive about, that we are happy to be associated with, or we approve of. We use that and those to create distance."
It is very similar to the French constructions of voici and voila, which generally mean "this here" and "that there" respectively.