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They just do more damage. The ones i use (area effect arrows) have an impact of an exploding grenade, so it's not wise to use them in crowded places where there's also friendly people around, cause more or less, they all get hit by that one single arrow.
They don't fly further than other arrows, they just have a larger impact. There are lots of different arrows outthere. Some are poisonous, some paralyze the targeted creature, others pierce through armour, etc.....
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