The best way to determine how JPEG file compression affects an image is to graphically show you images with different JPEG compression values. To drive the point home, the following side-by-side images allow you to compare compression values and file sizes while visually seeing the differences.
Both images are from the same source, yet I've saved them with compression values of 10, 8, 6, 4, 2 and finally zero. Select a compression ratio from beneath the image on the left to see how that affects image quality and file size. You can select a different ratio for the image on the right to visually compare different compression values.
Some thoughts:
You can see subtle differences between each value, but major differences between the file size. For example, between levels 10 and 8 there isn't much visual difference in the files, but at compression level 8 you save 16K bytes in file size, which means the level-8 image will load faster without much of a sacrifice in quality.
At level 4 some of the "fuzziness" of the image is evident. This is due to the "lossy" nature of JPEG images; information is lost in the compression -- which is tight enough to make these files nearly half as large as the level 10 image.
Level 0 is gross. True, if you've never seen a digital picture before, you might sing its praises, but the compression is so high that major chunks of information are missing. Also notice that level 2's image is much better than level 0, with no real difference in file size.
