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Let's take a look at another example that will illustrate what happens if the packet's destination is a router. For example, in-interface receives ICMP (ping) packet, its destination is the router itself, so packet will go for local-in processing. After packet is processed ICMP (ping) reply is generated inside the router (Local-out processing) and will be sent out over out-interface.
Simple explanation of each box before we go further with examples:
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