Jury fees have a few purposes. They help limit the amount of entries to those who feel their work is strong enough for acceptance. They also finance whatever prize money is offered. Jurors are often given a stipend for their work. If the exhibition is in a physical location (a gallery), the fees can go to help with promotion, salaries, rent, etc.

Before entering competitions, you should do some research. Much of it can be done online. First, check out the venue. If it's a gallery, look at their website. Look at the physical layout, the location, the artists they rep, and the kind of work they offer. Research the juror(s). Do you think your entries would be the kind of work they'd find appealing? If it's an annual competition, most galleries will have posted the winners/accepted work from prior years. Look at the quality of what got in.

Competitions are a good way to get your work seen, add to your CV, and (to a lesser extent) get your work sold. The only one's I avoid are the on-line competitions. As Clive said, they can be scams. The only ones I enter are those in a physical space, with at least a month long exhibition, reputable juror(s), and reasonable jury fees. I've been accepted, rejected, won some cash, sold some work, but always apply knowing the odds are long...