Causes of Confusion #1

Having taught basic computers, I am aware of some of the main reasons why people
get confused about the difference between folders and files. One problem is that the
icon commonly used to portray a folder on computers is an image of the folded card
receptacle found in traditional office filing cabinets that's known as a "Manila file folder".
The inclusion of the word "file" in the term "Manila file folder" misleads some people. It's
best just to think of it as a "Manila folder" to avoid confusion.

Causes of Confusion #2
Although it is generally true that folders hold files and other folders, but files don't, there
are occasional cases where files can act like folders. One common example is
compressed files, such as ZIP files. These contain a number of files and folders that
have been manipulated and merged together in order to save space without data loss.
The two main advantages of compressed files are that they make downloading faster
and also enable more data to be stored on removable media, such as a USB memory
stick. Although compressed files are treated as individual files by some programs,
modern operating systems are able to also effectively treat them as folders. The
operating system decompresses them, enabling users to browse them as folders.
Without folders to organize data, your computer would take much longer to find the files
it needs to operate.