Web server level: At this level the Machine.config file is located in Windows\Microsoft.NET\Framework\version\config directory. This helps to set the base configuration for all .NET assemblies that is running on the server.
Application or Web site level: At this level the Web.config file located in the IIS root directory. It helps to set the base configuration for all Web applications and overrides the settings that are in Machine.config file.
In the sub directory of an application root folder: This override the settings in the root folders of web.config file.
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