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Categories and tags in WordPress – How to use them? What is best for SEO?

What is the best for SEO, categories, or tags? What is the difference between categories and tags? What is the optimal number of categories in WordPress? How many are too many? Is it okay to assign one entry to several categories? Is there a limit to the number of tags we can assign to each entry? Do the tags work as meta keywords? Is there an SEO advantage to using categories or tags?

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