These are both good questions. OK, first of all: Use "it" when there is an antecedent that could be feasibly inserted in its stead. For instance, you could say "give the dog its bone" because you could insert "the dog" for "it": Give the dog (the dog's) bone.
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mulderFor example, (speaking )
A : I swim every day
B:It's good /that's good.
A: I can help you with your homework
B: I really appreciate it / that,/ this
(writing )
The governement is laid back and doing nothing about it. That/ it/ thismakes things worse.