What is the significance of Visual Studio Package File and how to use it? See the image below.
Can any one provide an explanation?
You can use the Package Designer to create and customize a package (.wsp). For example, you can add SharePoint project items and Features, specify if the Web server is reset when the solution is deployed, and set the deployment server type.
it contains all the files for deployment like xml, dll, wsp ect...
http://msdn.microsoft.com/en-gb/library/ee231544(v=vs.100).aspx
for deployment follow this:
http://msdn.microsoft.com/en-us/library/vstudio/ee231544(v=vs.100).aspx
hope it helps :)
You can double-click on the Package.package file and see in the designer what you can do with it (for instance, change what features and mapped folders to deploy).