In order to digitize new points using a GPS unit or create customized files with shapes and lines to add to a Map Project, you must first create a Shapefile. When seen through Windows Explorer, a Shapefile is actually composed of a five separate files with .dbf, .prj, .shp, .shp.xml, and .shx file extensions. If you move or copy a Shapefile, you must move all five of the associated files in order for the Shapefile to work properly.
When seen in ArcMap, ArcCatalog, or ArcPad, Shapefiles appear as a single file with an .shp file extension.
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