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This instruction is executed only one time. Next is the loop function that sets the pin 13 HIGH (+5V on pin 13), waits a second (1000 ms), then turns OFF the LED (0V on pin 13) and waits another ...
According to how long it stays in 5V and 0V (using the delay() function) you can obtain the fade effect. If delay() has a low value (for example 50ms or 0.05s) the fading speed will be higher because ...