Do not spend ANY more the $20 on this machine as it is really only worth $200 in perfect condition. What you are describing is the computer cannot find a startup volume. This could be due to a failed hard disk or no OS installed on it. First, try starting in the Recovery Partition and run First Aid (located in Disk Utility) on the hard disk. Run First Aid 2-4 times back to back, if ANY errors appear then your HD has failed and you should stop there.
To start in the Recovery Partition, hold down Command + R on startup. If it will not start up in Recovery Partition, that is another good indication to stop there.
It was given to you for a reason, basically it has no worth, it's obsolete and parts are not readily available for it.