Quick Answer
Exception hierarchy: Throwable at top. Two branches: Error (serious system problems - OutOfMemoryError, StackOverflowError - don't try to catch these) and Exception. Exception branches into: checked exceptions (must handle - IOException, SQLException) and unchecked/RuntimeException (NullPointerException, IllegalArgumentException, ArrayIndexOutOfBoundsException). RuntimeExceptions typically indicate programming bugs.
Answer
Throwable ? Error and Exception. Error: Serious issues (not handled usually). Exception: Can be handled. Checked exceptions must be declared; unchecked are runtime exceptions.
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Verified Answer
This answer has been peer-reviewed by industry experts holding senior engineering roles to ensure technical accuracy and relevance for modern interview standards.