A filing cabinet can contain many drawers. A drawer can contain many filing jackets or folders. A filing jacket can contain many documents. Each one of those documents contains actual information. If the root directory is the filing cabinet, Subdirectories are the drawers.
Additional subdirectories are the filing jackets.
A file is equivalent to a paper document, in this analogy. Users may also have a 'scratch' directory for temporary file storage. Any files that you create, transfer or save are in your home, Mail, News or scratch directories. The home directory has the same name as the user's logon name. For instance, if a user's login name is 'highlow', the user's home directory is named highlow.