This action opens the Select Folder window, in which you can select the application that you want to build and test. For example, this can be your own application or one of the samples provided in the nRF Connect SDK tree that can be run out of the box with their basic configuration.
You can also use this option to open an application obtained from different sources. For example, this could be an nRF Connect SDK application that you worked on in a different IDE, such as SEGGER Embedded Studio Nordic Edition, or an application created by someone else who shares it with you from their fork.
Note
Opening an application directly from the nRF Connect SDK tree is not recommended since this can pollute and change the nRF Connect SDK sources.