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To reduce the file size of a 26 MB file, you can compress images in two ways. The first method is to select a picture, go to the picture format tab, choose compress pictures, and select an option like high fidelity. You can also delete cropped areas of pictures to further reduce the size. The second method is to click file, compress pictures, and the default is to compress all pictures in the file. After compressing, remember to save the changes to see the new, smaller file size.