A JPEG is a regularly used method of lossy compression of photographic images. The JPEG file format that has made it so popular is the fact that it doesn't take up much storage space. JEPG files can be printed directly from your camera without editing the pictures first but the more compression you use, the more smudges appear.
A PNG is a bitmapped image format that employs lossless data compression. IT has an alpha channel to give the option of using 8 bits for transparency. Although It is a relatively large file format.
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