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This video tutorial from Cohere AI explains word and sentence embeddings, essential components of large language models. These embeddings enable computers to process language by converting words and sentences into numerical representations. Each word is linked to a list of numbers, while sentences are similarly encoded. This process is not manually done; rather, it utilizes neural networks that analyze context. When two words appear together in similar contexts, their numerical representations are adjusted to be closer. This method allows for sophisticated understanding and processing of language, resulting in impressive outcomes.