a computer engineer does need to understand some of the basics of how the software works - but can be quite limited and more around the machine code or operating system rather than applications
I would still separate the two
A software engineer maybe able to programme in C language or quite a few other languages, access, SQL, etc , and a hardware engineer would not need to understand these programs, BUT would need to have a basic understanding of how a computer works and uses machine code or operating system to carry out instructions
And also be able to run software as tests etc
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