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Is it necessary to increase resolution of an image if we are increasing width and height of an image. Let say I have an image 700x523 and I want to change it to 800x598 and resolution is 72, should I increase the resolution too in order to get higher quality or should I let it as it is. What will happen if I increase the resolution? Will it improve quality or what? Please help.
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You can't increase the quality of an image by enlarging it. An image that's 700 x 500px will print at a maximum size of around 3.5 x 2.5 inches (at 200PPI). The resolution of an image (PPI) is irrelevant when used on a screen such as a web page.
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The resolution only matters when printing your image, and with sizing type in points. Both involve physical units, inches and points (a point is 1/72 of an inch). If any type is specified in pixels, as long as the pixel dimensions remain the same, the resolution could be 5 or 500, and it won't look any different on a screen.
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Increasing the size of your image from 700x523 to 800x598 will result in your screen image looking slightly less sharp because Photoshop will invent new pixels in a process called 'up-sampling' The algorithm that does this is pretty good though so you are unlikely to see much of a difference on screen-the image on screen will look larger at 100% magnification though. Increasing resolution as previously said will make no difference at all to the screen image, but if you print the image it will be bigger than before at the original resolution and so the resolution could be increased in order to keep the image size the same as the original. This can help to counter any blurriness due to the up-sampling process.
Terri