On page 27 of the nerdkits manual it you put a capacitor from pin 7 and 8 of the microcontroller and it says it's to consistently provide the spikes of power needed for a digital device. But I thought this was what the clock does? Also, why does the capacitor go there. How does pin 7 end up at pin 8 inside the microcontroller? Wouldn't it have to go through the whole device? The only time I've ever seen a capacitor used was by itself (with a resistor) to store up charge. What does it mean to insert a microcontroller in between it?

What purpose does the reset pin 1 serve. Why do I connect pin 21 to +5V and pin 22 to ground? Thanks for the help.

Also, why can I measure farads for the capacitor when I stick the multimeter leads on the component, but when I put it in the breadboard and measure through a row I don't get anything. Similarly, I guess, why don't I get a beep for continuity when I measure across the voltage regulator (on the component or through the breadboard)?

Lets take this real slow.

Page 27 capacitor reference says:

[quote]
Inside your parts bag, you should   see three   yellow capacitors. The largest one is 0.1uF, or 0.1 microFarads.
Insert  the 0.1uF capacitor between pins 7 and 8 of the microcontroller (+5V and GND). You may want 
to trim the leads of the capacitor so that it sits closer to the breadboard when you plug it in.
[/quote]

[quote]
A capacitor is a device that stores energy in an electric field. It stores opposing electric charges on its terminals, 
which maintains a voltage across it. We're using it here as a "bypass capacitor," to help smooth out the power 
supply voltage to the microcontroller. This helps keeps the power supply voltage steady even when there are 
sudden changes in  the demand for current.
[/quote]

I do not know where you got:

[quote]
and it says it's to consistently provide the spikes of power needed for a digital device.
[/quote]

But if I saw that I would also have to question it.

I do not think I could explain why the capacitor is placed between pin7 and pin 8 to act as a "bypass capacitor" better than the manual.

Are you having problems comprehending "bypass capacitor".

Pin7 is Vcc (+ 5 volts) Pin8 is at Gnd (- ground).

Now picture some noise on the wiring, noise being spikes in voltage, the "bypass capacitor" would pass any spikes on Vcc to ground

therefore filtering out the noise.

Unless you have rather fancy multimeter most do not measure capacitance are you looking at continuity?

Pin 20 is AVCC Pin 21 is AREF Pin 22 is Gnd. To put it simple the microprocessor uses the Pin21 voltage for a "Reference" for the internal ADC (analog to Digital) converted.

These type questions lead to the standard "Read the Specsheet" refrain.

You probable do not get a beep reading across the voltage regulator because there isn't any continuity.

Hang in there it will become more understandable with time and effort on your part.

You are going to have to literally read the specsheet. You will not understand it, to say nothing of comprehending it, but you will start to get familiar with it's contents. One of these day's you will have a question or see a question here in the forum and you will go "Hey that's in the specsheet".

Make sure and ask your questions, there will be more.

Ralph