What is the purpose of the file extension?

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What is the purpose of the file extension?
The file extension is the three letter file type designation following a period at the end of a file name. It determines what type of file that file will be treated as.

Changing a text (.txt) document to .wmv will make the computer treat it as a Windows Media Video file and thus it will be opened with your default program for viewing .wmv format videos.
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