-- It's an easy way of finding out whether the candidate has done some homework about the company and the role. For insecure interviewers, it's a request to be flattered. For confident ones, it's a way of finding out whether the candidate has identified a specific opportunity that she or he is genuinely excited about. Having employees who are intrinsically motivated works out better than just a group of paycheck collectors.
-- It's a way of finding out whether you might be promotable. That's especially important in a growing company. As opportunities increase, there's an "up or out" dynamic that moves the most valuable employees into bigger roles, while shedding the ones that have little chance of rising higher. (Netflix is famously candid about this; many other companies think the same way but don't surface it.)