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Listeners use linguistic feedback to provide evidence of understanding to speakers. They, in turn, use it to reason about listeners' mental states, to determine the groundedness of communicated information and to adapt subsequent utterances to the listeners' needs. We describe a probabilistic model for the interpretation of listener feedback in its dialogue context that enables a speaker to evaluate the listener's mental state and gauge common ground. We then discuss levels and mechanisms of adaptation that speaker's commonly use in reaction to listener feedback.