What are environment variables and how are they used in Next.js?

Instruction: Explain the concept of environment variables and their application in Next.js.

Context: This question assesses the candidate's understanding of using environment variables for storing sensitive information outside of the application's source code.

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In the context of Next.js, a popular React framework designed for building server-side rendered and statically generated web applications, environment variables play a crucial role. Next.js provides built-in support for loading environment variables from .env files into the application, making them accessible both on the server-side and, selectively, on the client-side.

To utilize environment variables in Next.js, you typically start by creating .env files at the root of your project. For instance, you might have .env.local for local development, .env.development for the development environment, .env.production for production, and so on. Inside these files, you can...

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