A string is a sequence of characters. A string can be a word, phrase, sentence, or paragraph. It can contain numbers as well as variables, and even HTML tags. “Save settings” and “Please look at %(URL)s for more detail.” are both examples of strings. "Save settings" is a string that contains two words.
Every sequence of characters and numbers between whitespace (spaces, tabs, and newlines) is considered a word. The phrase "Today I've read that Mars has 2 %(moon)s." has eight words.
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