This dialog box is opened when you use the Add Text command command from the Graph menu. If you choose the On new layer option, the text will be inserted as a new layer which has the size and the position of the text. You can then modify the size and position of this layer with the layer Geometry (see the Add Layer for details). Beware that in this case, all text which is not in the layer will be clipped, therefore, you need to modify the layer to modify the position of the text. If you choose the On Active layer option, the text will be inserted in the selected layer, and its position can be modified directly with the mouse inside this layer.