Normal for iTunes to download a game already purchased on iPad?

I downloaded a large (500MB) game on my iPad, and after syncing with iTunes, the game appeared in the list of apps. However, then iTunes proceeded to download the game from the iTunes store.
Is this normal behavior? Doesn't iTunes simply transfer items purchases on a mobile device to the library when the device is synced. This is always how it's worked in the past. Does this have to do with iCloud or something?

Thanks. So with this setting, iTunes will not copy the item from the mobile device, instead it will download it? I just want to make sure I don't have doubles of things.
This seems odd, because, for example, after I spend an hour downloading 10 TV shows to my iPad, why would I want to spend another hour downloading them to my computer as well...especially when they could be transferred via USB?
Isn't this how it was done in the past?
If I don't tick off the download boxes, are things still copies via USB when the device is synced?

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