This tool lets you zoom in and out of the image. You can either click with your left mouse button to zoom in closer to that point, or with your right mouse button to zoom out of that point. Alternatively, you can left-click and drag a box around the region to which you want the window zoomed to.
Also note that while using any other tool, you can press Control + + to zoom into the image, and Control + - to zoom out of it. Finally, Control + 1 will set the zoom to 100% - the original image size.
Similarly, Control + F will zoom to all currently selected shapes, and if none are, it will zoom to all shapes in the document.
(c) 2008 Ketara Software