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Computers store information in files. When you use an application, it generally creates a file to hold your work; this is one way files are created.
Every file has a name and some contents. A file usually contains some piece of information, such as a letter, report, or phone list. The filename is a label you give the information to keep track of it.
A computer can contain thousands of different files. To manage this huge group of files, the operating system groups them into directories. Files that belong to a certain person or files associated with a particular program are often stored in a directory of their own. To see a particular file, you have to go to the directory that holds it. Each directory has a name, just like a file. However, while a file holds information, a directory holds files and other directories, known as subdirectories.
When you log into your computer, you are in your home directory. This is where you keep your own files and do your work. The name of your home directory is probably the same as your login.