Explanation:
Box 1: Standard Client Upgrade Task Sequence
Use Template: Standard Client Upgrade Task Sequence
In-place upgrade is the preferred method to use when migrating from Windows 10 to a later release of Windows 10, and is also a preferred method for upgrading from Windows 7 or 8.1 if you do not plan to significantly change the device's configuration or applications. MDT includes an in-place upgrade task sequence template that makes the process really simple.
Box 2: Install.wim
In-place upgrade differs from computer refresh in that you cannot use a custom image to perform the in-place upgrade. I Reference: https://docs.microsoft.com/en-us/windows/deployment/deploy-windows-mdt/upgrade-to-windows-
10-with-the-microsoft-deployment-toolkit