Chain and Sprocket Understanding?

I would appreciate some education on chain, sprocket and idler/tension gear understanding.

 

When the tensioner sprocket on a piece of equipment has used up all the adjustment, what has happened to create that?

Has the chain stretched, worn or both?

If the sprocket wears, is it just the teeth or the diameter?

I know removing a link of chain will remove the slack. Will shortening the chain solve the wear issues or create more?

Will placing the tensioner sprocket under the chain and raising it to remove slack be the same as removing a link (considering the idler sprocket was originally on top pushing down)?

 

We have always removed a link.  I just always figured the chain simply stretched. If so, why does it still fit the sprockets when a link is removed? 

Just curious about just what all takes takes place to cause slack in a chain.

Chain and Sprocket Understanding?