The “Exactly” setting seems like it should be straightforward.
If you want 2 points of space between each line of 12-point text, set “Exactly” to 14 points.
So, for anyone who has ever wondered, here’s a short primer on font size and line spacing. Thus, a 12-point font is 1/6 of an inch high, as measured from the lowest descender (the tails on letters such as g, j, and y) to the highest ascender (the top parts of letters such as b, d, and h). In reality, a “12-point” font is what looks good with other “12-point fonts.” Here are two letters, in Times New Roman and in Courier New, at the same font size (e.g., 12 pt), with line next to them that is exactly that length (e.g., 1/6 inch).
If you type documents in Word for a living, you probably use 12-point Times New Roman. As you can see, the two fonts are not the same size, and neither one is a full 12-points high.
If it is set to one line, each line of text will be written one after the other, with no extra space in between.
If it is set to two lines, commonly referred to as "double spacing," each line of text will be followed by a line of white space with the next line of text below.
Double spacing makes a text document feel more open and is typically easier to read.
High school and college students especially like it because it can instantly turn a 5 page paper into a 10 page paper.
Leading (rhymes with “wedding”) is the distance from one line of text to the next line; its name reflects the fact that typographers used to alter the line spacing by putting strips of lead between lines.
Today, it’s found as the “line spacing” option in the “Paragraph” formatting menu of Word: Back in the old days of typewriters, line spacing was always 6 lines per inch (12 points per line).