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A cookie is a small piece of information that is exchanged between a web browser and a web site. When you visit a web site, the site may offer your browser a cookie, which is then stored on your local disk drive by the browser. Then, whenever you visit the same site in the future, your browser will automatically send that cookie back to the web site.
Cookies can be very useful, as they are often used to identify the user who is connected to the web site and show information that is relevant to him or her.
A good analogy would be buying a cinema ticket. When you enter a cinema, you are given an anonymous ticket that identifies your seat number. So long as you store the ticket in your pocket, you can leave the cinema, return some time later, be re-admitted and directed back to your seat. In this case, the ticket is exactly analagous to a cookie: it is a useful piece of anonymous information that is only valid at one cinema and is used to identify a valid customer.