can you elaborate on full or diff backup?
full database backup or differential database backup. Check books online if you want more details
I guess the point in time restoration allows you to restore to particular time and simple logging will prevent you from doing this and will allow only to restore when the last backup was made, is that right?
Correct. Again, look in books online for more details.
How does that command break the log chain? I don't understand that.
It discards log records without backing them up. Missing log records means no restore, plus log backups will fail after that command is run.
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