An ARC file is a compressed archive file, which means that it is a single file that inside can contain one or more files that have been reduced in size. This is often done to ease and speed up distribution over the Internet and to save storage space.
ARC was designed and created by SEA in the early 1980s and is a form of loss-less compression. This means that the data can be compressed and then reconstructed exactly at the other end. In other words, no information is lost as a result of the compression. 
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