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What do "Latino" and "Hispanic" mean?

Recently, we've been taking a look at the terms our reporters use when describing certain groups of people. There are those who argue that "Latino" and "Hispanic" are largely synonymous, and can be used interchangeably. Others note that traditional, academic definitions of the two words mean very different things, and that it's important to use each word correctly. We'd like to get your opinion. What do you think Latino and Hispanic mean? Which term do you prefer? In which situations would you use one of the words?

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