How to configure proxy correctly?

Question

Squid

I'm trying to set up a proxy server based on ubuntu server + squid. Ideally, I think the scheme should look like this:

But for testing, I put the computer like this:

So far, I'm trying to raise the interfaces, they do not work correctly. Assigned those addresses that on the 2nd scheme.
Sites are pinged from a proxy server only by IP addresses, there is no ping by DNS. Why?
If you register the gateway 10.86.0.18/24 on the local machine, then there is no Internet, is this most likely because squid has not yet been configured or should there still be an Internet?

Answer 1

put the browser settings file on it to set the proxy.

- Can you be more specific here?