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Encryption is the process of converting plain text into a coded and unreadable format, making it difficult for unauthorized individuals to access sensitive data. This is important because even if a laptop is stolen, the encrypted data would require a unique key or password to unlock and make it readable again.

The other options may also contribute to data security, but they may not necessarily protect the data if the laptop is stolen.

A firewall helps monitor and control incoming and outgoing network traffic, but it may not fully protect data if the laptop is physically stolen.

Antivirus software helps detect and remove malicious software, but it may not fully protect against data theft if the laptop is stolen.

File permissions limit access to specific files or folders, but they may not prevent someone from physically stealing the entire laptop and accessing the data.

In conclusion, while all options may contribute to data security, encryption is the most effective measure for ensuring data security on a laptop even if it is stolen.