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The general rule is, the smaller you can get the file size for
what you need, the better! And by smaller, I mean file size not just display
size. Now which kind of file you should use depends upon the kind of picture
you are working with.
GIFs need things very simple.
Fewer colors, and less detail. For things like simple clipart images,
this is your best bet. You also can do images that are transparent - for
example, a colored arrow.
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transparent
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not transparent
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However, if you have detailed images like photos, it's
time to think about using
JPEGs are equipped to handle more
complex images. Photographs and images with lots of colors or fine detail
should be saved as JPEGs.
Look at the following two images.
 
One is displaying smaller so the load time should be
shorter, right? Wrong. This image is still 13K either way, so
the load time is no different. Right click on the image, and both will
still show up the same size. The moral of the story - resize all of your
images in a graphics-editing program based on what you need!
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