From Jacci Howard Bear,
Your Guide to Desktop Publishing.
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Graphics come in many flavors but not all file formats are suitable for all purposes. How do you know which is best? In general, there are graphics formats suitable for printing and those for on-screen viewing or online publishing. Within each group there are also formats that are better than others for the same task.

Use GIF and JPG for online publishing. Although other formats for online publishing are in development, at present GIF and JPG are the standards. Use EPS and TIFF for print publishing. If all your printing is sent to your desktop printer, you may be able to use other formats including CGM and PCX with acceptable results; however, for high-resolution output EPS and TIFF will provide the least hassles and the best quality. They are the standards for high-resolution printing.

In addition to the formats in the chart, below, there are proprietory graphics file formats. These are bitmap or vector formats used by specific graphics programs. Although some desktop publishing software will recognize the more common formats such as PSD from Adobe Photoshop (bitmap) or CDR from CorelDRAW (vector) it is generally best to convert these images to TIF or EPS or other common graphics file formats.

This simple chart outlines the best use for several common formats. Match the format to your job either by starting with graphics in that format or by converting other artwork to the desired format.