By default, Image Arithmetic Tool processes the entire image. But if this item is checked, Image Arithmetic Tool processes only inside the search window of the command tools which use the result image. According to the number of found, processing only inside the search window may reduce the processing time of Image Arithmetic Tool.
Note that Image Filter Tool processes inside the search window only in the following cases. In the other cases, Image Filter Tool processes the entire image even if the item is checked.