Files come in various formats and each format has its particular strengths and weaknesses.
The type of file you use for your purpose can have a huge effect on the quality of the media that you are working on, whether it be printed or web. Below is a breakdown of various types of files and the differences between them.
 Adobe Illustrator (Vector // Print)
| File Purposes: Use for print projects unless vendors specify otherwise.
Vector graphic, resolution-independent.
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 Encapsulated PostScript (Vector // Print)
| File Purposes: Use for print projects.
Vector graphic, resolution-independent.
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 Joint Photographic Experts Group (Raster // Digital)
| File Purposes: Digital screen use only.
Raster graphic, resolution-dependent.
Enlarging will degrade image quality.
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 Portable Document Format - Vector-Based (Vector // Print)
| File Purposes: Viewing on multiple platforms.
Vector graphic, resolution-independent.
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 Portable Network Graphics (Raster // Digital)
| File Purposes: Digital screen use only. Supports transparency (whereas .JPG does not).
Raster graphic, resolution-dependent.
Enlarging will degrade image quality.
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.EPS and .AI files will not be usable unless you have Adobe Illustrator or a similar vector graphics editor.
For web use, .JPG files will usually be sufficient. Keep in mind that raster format images (.JPG and .PNG) should not be enlarged as they will quickly lose quality. Vector images (.EPS and .AI) can be resized, but only via vector editing software such as Adobe Illustrator.