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If statements in Microsoft Word templates allow for the comparison of values to display content based on the result. They are useful for dynamically comparing compose merge fields to show appropriate results, such as displaying domestic or international shipping rates on an invoice based on the account billing country. If statements consist of expressions to compare values, operators like equal to or not equal to, and true/false texts to display based on the comparison. This allows for the conditional show/hide of shipping information based on the account billing.