Extensible Markup Language (far better known as XML) is pervasive in .NET. It's used as the format for configuration files, as the transmission format for SOAP messages, and in many other places. It's also rapidly becoming the most widespread common language for many development platforms.
This objective tests your ability to perform many XML development tasks. To pass this section of the exam, you need to know how to read an XML file from disk, and how to create your own XML from a DataSet object in your application. You also need to be familiar with the XPath query language, and with the creation and use of XSD schema files.
You'll also need to understand the connections that Microsoft SQL Server has with the XML universe. You need to be able to extract SQL Server data in XML format, and to be able to update a SQL Server database by sending it properly formatted XML.
Finally, the exam tests your ability to validate XML to confirm that it conforms to a proper format. The .NET Framework includes several means of validating XML that you should be familiar with.