The “Case-sensitive” formats allow for file names with capital letters to be different from lowercase letters. So, for example, three files named FILE, File, and file can exist in the same folder. You probably don’t need to use a Case-sensitive format.
MS-DOS and ExFat are PC formats. Since we’re formatting a Mac startup drive, you can ignore these two.
There’s a third selection you need to make called Scheme. For an Intel-based Mac running El Capitan, select GUID Partition Map. There are two other options you can ignore: Master Boot Record is for Windows, and Apple Partition Map is for PowerPC-based Macs (remember those?).
When you click Erase, Disk Utility will erase the data, reformat the storage device, and mount the drive on your desktop. Click Erase when you’re ready to proceed. After a few minutes, your storage device will be ready for you to install El Capitan.
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