This app serves two purposes:
1. Your fingers touch a portion of the screen, but the touch screen only registers a single pixel. This allows you to see exactly where your device registers your touch.
2. Find out if there are any areas that do not register your touch. For example, your device will likely not register the far edges of your screen.
UPDATE: Sorry about it not having an exit button. My phone has physical buttons so I never thought it was a problem. The EXIT button is placed randomly, so if you want to test the screen where the EXIT is, just exit and return to test that area.