How auto discover works in DHCP?

What is DHCP? How Does DHCP server assigns IP address for client User?

DHCP-Dynamic Host Configuration Protocol, is a client/server protocol that automatically taken IP address and others related configuration information such as,
1. IP address
2.Subnet Mask
3.Default gateway
4.DNS server

How to check Systems are taking IP Address from DHCP Server?
1.Start—control panel -Network and sharing Center

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Click Local Area Connection and see a speed of Network.

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Click on Details and find DHCP server is Enabled or NOT.

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How does DHCP server assigns IP address for clients?

DHCP server assign a IP address through DORA process.
DORA is stand for Discovery Offer Request Acknowledge. Before it will check which IP address is free in switch related to IP ranges to assign.

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D- D in the term DORA stands for the DHCP Discover packet. And client searching for available DHCP server in Network.
O- O in the term DORA stands for the DHCP Offer packet. The DHCP Offer the available IP address that the DHCP server offers to the client computer.
R– R in the term DORA stands for the DHCP Request packet. The DHCP request for IP address from DHCP server which client user can get an offer from DHCP Server.
A-  A in the term DORA stands for the DHCP Acknowledge packet. Once DHCP server assigned IP to client user and send Acknowledgement.
Once the entire DORA process is completed, the DHCP server marks the IP address as assigned in its database, and the DHCP client computer starts using the assigned IP address to communicate with other computers in the network.

Please refer the Article for How to Create a Scope in DHCP Server