Here are a few reasons for using XML (in no particular order).
Not all of these will apply to your own requirements, and you may
have additional reasons not mentioned here (if so, please let the
editor of the FAQ know!).
* XML can be used to describe and identify information accurately
and unambiguously, in a way that computers can be programmed to
‘understand’ (well, at least manipulate as if they could
understand).

* XML allows documents which are all the same type to be created
consistently and without structural errors, because it provides
a standardized way of describing, controlling, or allowing/disallowing
particular types of document structure. [Note that this has absolutely
nothing whatever to do with formatting, appearance, or the actual
text content of your documents, only the structure of them.]
* XML provides a robust and durable format for information storage
and transmission. Robust because it is based on a proven standard,
and can thus be tested and verified; durable because it uses plain-text
file formats which will outlast proprietary binary ones.
* XML provides a common syntax for messaging systems for the exchange
of information between applications. Previously, each messaging
system had its own format and all were different, which made inter-system
messaging unnecessarily messy, complex, and expensive. If everyone
uses the same syntax it makes writing these systems much faster
and more reliable.
* XML is free. Not just free of charge (free as in beer) but free
of legal encumbrances (free as in speech). It doesn’t belong to
anyone, so it can’t be hijacked or pirated. And you don’t have to
pay a fee to use it (you can of course choose to use commercial
software to deal with it, for lots of good reasons, but you don’t
pay for XML itself).
* XML information can be manipulated programmatically (under machine
control), so XML documents can be pieced together from disparate
sources, or taken apart and re-used in different ways. They can
be converted into almost any other format with no loss of information.
* XML lets you separate form from content. Your XML file contains
your document information (text, data) and identifies its structure:
your formatting and other processing needs are identified separately
in a style sheet or processing system. The two are combined at output
time to apply the required formatting to the text or data identified
by its structure (location, position, rank, order, or whatever).

HTML was already overburdened with dozens of interesting but incompatible
inventions from different manufacturers, because it provides only
one way of describing your information.
XML allows groups of people or organizations to question C.13, create
their own customized markup applications for exchanging information
in their domain (music, chemistry, electronics, hill-walking, finance,
surfing, petroleum geology, linguistics, cooking, knitting, stellar
cartography, history, engineering, rabbit-keeping, question C.19,
mathematics, genealogy, etc).
HTML is now well beyond the limit of its usefulness as a way of
describing information, and while it will continue to play an important
role for the content it currently represents, many new applications
require a more robust and flexible infrastructure.

The Simple Object Access Protocol (SOAP) uses XML to define a protocol
for the exchange of information in distributed computing environments.
SOAP consists of three components: an envelope, a set of encoding
rules, and a convention for representing remote procedure calls.
Unless experience with SOAP is a direct requirement for the open
position, knowing the specifics of the protocol, or how it can be
used in conjunction with HTTP, is not as important as identifying
it as a natural application of XML.

The Document Object Model (DOM) is an interface specification maintained
by the W3C DOM Workgroup that defines an application independent
mechanism to access, parse, or update XML data. In simple terms
it is a hierarchical model that allows developers to manipulate
XML documents easily Any developer that has worked extensively with
XML should be able to discuss the concept and use of DOM objects
freely. Additionally, it is not unreasonable to expect advanced
candidates to thoroughly understand its internal workings and be
able to explain how DOM differs from an event-based interface like
SAX.