A digital format is a format system that uses the digits 1 and 0 as codewords to interpret data received and data to be sent eg. a digital clock, computer signals.

What is a good format for data interpretation

usally by clicking on the data you wish to format an option will come up asking you if you want to format it

No. the format of a file is the description about how the data in it are structured. Thus the data described by the format can be compressed but the format itself can not.

The Data Interchange Format (DIF) file format is a text based format encoded in ASCII with a header, for integrity checking, and a body. The format was originally developed by Software Arts in order to transfer data from VisiCalc, the first spreadsheet.