An IP address is a unique series of numbers that identify a specific computer, and so allows it to communicate with other computers across the internet. An IP address is made up of four numbers, each ranging from 0 to 255, separated by periods (called a dotted-quad). So, an IP address can look like 1.0.1.1 or 125.234.04.157. IP stands for Internet Protocol, which is a set of laws dictating internet behaviour and allowing the completion of actions on the World Wide Web (WWW).
IP addresses are usually assigned to internet service providers and so activities done on a computer can be traced back to it, pinpointing that computer to, at minimum, a general location (city, for example).
IP addresses can sometimes be given hostnames so that it can be remembered more easily and used in colloquial situations.
Think of IP addresses as electronic mail addresses. Not like an email account that can be accessed from most computers in the world but like your computer is your house, the IP address is your mail box, and the internet is the international postal service. :)
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