Recursive CTE Work Flow

Hi To all,

Can anyone explain how recursive CTE works

--------------------------------------------
-- Synthesise table with non-recursive CTE
--------------------------------------------
;WITH Employee (ID, Name, MgrID) AS 
(
    SELECT 1,      'Keith',      NULL   UNION ALL
    SELECT 2,      'Josh',       1      UNION ALL
    SELECT 3,      'Robin',      1      UNION ALL
    SELECT 4,      'Raja',       2      UNION ALL
    --SELECT 5,      'Tridip',     NULL   UNION ALL
    SELECT 6,      'Arijit',     5      UNION ALL
    SELECT 7,      'Amit',       5      UNION ALL
    SELECT 8,      'Dev',        6   
)
--------------------------------------------
-- Recursive CTE - Chained to the above CTE
--------------------------------------------
,Hierarchy AS
(
    --  Anchor
    SELECT   ID
            ,Name
            ,MgrID
            ,nLevel = 1
            ,Family = ROW_NUMBER() OVER (ORDER BY Name)
    FROM Employee
    WHERE MgrID IS NULL

    UNION ALL
    --  Recursive query
    SELECT   E.ID
            ,E.Name
            ,E.MgrID
            ,H.nLevel+1
            ,Family
    FROM Employee   E
    JOIN Hierarchy  H ON E.MgrID = H.ID
)
SELECT *
FROM Hierarchy
ORDER BY Family, nLevel

if you can explain me step by step query working process , still i am getting bit confusion.

the first part query will return one row

ID    Name    MgrID   nLevel  Family
1       Keith   NULL    1       1

then this result set using after union all query .

how the level + 1 condition is working ?  and how its return values .

---

GVRSPK VENI