A directory serve to group related files, and act then as a namespace for the files within them.
A directory is just a file with the directory type
Windows: %TEMP% is the same than %LocalAppData%/Temp. It is used for user-specific items that should not roam with the user, either because they only pertain to that particular machine, or because they are too large.
What is the Home Directory known also as the user directory ?
What is the working or current directory ?
As a directory is a node in the file system tree as a file. They have the same location management. See file location