A circle of confusion refers to a point of light that is out of focus. In any given shot, only one plane at a certain distance is exactly in focus, meaning the light at that distance converges exactly onto the film sensor. Different distances will have different focal points behind the lens, and will not converge at the sensor, instead showing a circle.
Circles of confusion are measured in millimeters and can be used to calculate depth of field tables so that focus can be adjusted to put a plane in the distance exactly in focus.
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