What occurs when you click with the Type Tool to create a point type?

When you click with the Type Tool to create a point type, the text starts at the exact location where you clicked on the artboard. Point type is intended for short bursts of text or individual words, rather than flowing along a defined path like area type does. With point type, the text will extend horizontally from that starting point, and will not automatically create a bounded box for the text, nor is it designed for paragraph formatting in the same way that area text is.

This behavior highlights the nature of point type, which is best suited for short labels or text annotations, allowing for greater flexibility in positioning without being restricted to a defined area. For longer blocks of text that require paragraph formatting, area type would be more appropriate.