At first I have to admit that you are partially right. There are debuggers that will stop the execution at a exception and show your code line that caused it. I would love to see this behavior in the eclipse debugger. But the other answers are right.
While you are in Eclipse go to Window -> Show View -> Other -> Android -> LogCat
Now you will get all the debugging output that occurs on the emulator or a connected device.
With you example I will get the following StackTrace.
T03-18 09:45:12.398: ERROR/AndroidRuntime(1778): Uncaught handler: thread main exiting due to uncaught exception
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): java.lang.RuntimeException: Unable to start activity ComponentInfo{android.client/android.client.ClientMain}: java.lang.ArithmeticException: divide by zero
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.app.ActivityThread.performLaunchActivity(ActivityThread.java:2401)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.app.ActivityThread.handleLaunchActivity(ActivityThread.java:2417)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.app.ActivityThread.access$2100(ActivityThread.java:116)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.app.ActivityThread$H.handleMessage(ActivityThread.java:1794)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.os.Handler.dispatchMessage(Handler.java:99)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.os.Looper.loop(Looper.java:123)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.app.ActivityThread.main(ActivityThread.java:4203)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at java.lang.reflect.Method.invokeNative(Native Method)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at java.lang.reflect.Method.invoke(Method.java:521)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at com.android.internal.os.ZygoteInit$MethodAndArgsCaller.run(ZygoteInit.java:791)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at com.android.internal.os.ZygoteInit.main(ZygoteInit.java:549)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at dalvik.system.NativeStart.main(Native Method)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): Caused by: java.lang.ArithmeticException: divide by zero
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.client.ClientMain.onCreate(ClientMain.java:35)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.app.Instrumentation.callActivityOnCreate(Instrumentation.java:1123)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.app.ActivityThread.performLaunchActivity(ActivityThread.java:2364)
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): ... 11 more
03-18 09:45:12.438: INFO/Process(52): Sending signal. PID: 1778 SIG: 3
If you go to the deepest Exception shown that one that raised all the others you will see
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): Caused by: java.lang.ArithmeticException: divide by zero
03-18 09:45:12.428: ERROR/AndroidRuntime(1778): at android.client.ClientMain.onCreate(ClientMain.java:35)
This is pretty clear I think. On line 35 in the ClientMain an Exception was thrown and it was a divide by zero exception. If you can't figure this out (in a case not as clear as the example) you can set a breakpoint on this line or the entry point of the method or something. Now the debugger will show you all the variables and you can step execute the code step by step until the error occurs. If you hover over a varibale you can see the value of this variable and now you can step by step try to understand the cause of the exception and solve it. If you step to deeply into the code you will end in the java class that is responsible for doing the division, if you haven't added the jars with the source code of this classes to your project the debugger isn't able to show you something at this point.