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This is the language used in APA reference style. An in-text citation refers to the work of others in your writing. In APA format, you use the author-date method of in-text citation (ie. Smith, 1998). A complete reference to this source must then appear in the reference list at the end of the paper. All sources that are cited in the text must appear in the reference list at the end of the paper.
A reference list differs from a bibliography, since bibliographies may include other works that an author consults regardless of whether they are mentioned in your essay. In APA Style, each entry in the reference list must be cited in the text. Therefore if you only cite two sources in your paper, your reference list will be very short. This doesn't take into account any other research or sources you consulted.
Other citation styles like MLA and Chicago Style use bibliographies. MLA uses in-text citations, referred to as parenthetical citations. The Chicago Style notes system is preferred by humanists, but those in the physical, natural and social sciences may use the author-date system where sources are briefly cited in text by author's last name and date of publication.