What does it mean when you computer crashes and when you turn it back on it shows you a blank blue screen with a little folder and a question mark in the middle?

It means the computer can't find a bootable volume. iMacs of that age can simply "forget" where to find the boot volume if they have been off wall power for a long time and the internal backup battery dies. There are a couple of easy ways to overcome this if that is the case:

1) Start from a system CD by holding the c key down until you see a desktop. May take a while. The CD should have an abbreviated control panel set, one of which is something like "Startup Disk." Select your hard drive for it and click restart.

2) At startup, press and hold the four-key combo command + option + p + r until you hear at least THREE startup chimes, then let go the keys and let the startup finish. That resets the computer's factory defaults for where to find the boot volume.

If either starts the computer, make sure it stays on wall power---unplugging with a dead PRAM battery will make it forget again, whereas turning it off while plugged in allows a trickle of the wall current to bypass the power supply and switch and maintains the fresh setting in storage.

If these don't get it going, we've moved past "easy" to "bad hard drive." Post back your results of the easy fices and we can go from there.

Also when you way hold the c key down do you mean turn computer off and turn back on holding the c key?

Place cd/dvd in machine. Power off machine. Hold down c key. Power on. Wait until you are sure machine is reading from cd/dvd.

I like:

Try holding down the option key then power on. This brings up the startup manager. Click on your dvd or hd. Click on right arrow key.

You should move on to step two if you do not have DVD. You could use full install dvd, if you have one that works with the machine.

If step two doesn't solve problem you could try:

Sometimes if volumes don't appear in Startup Manager (what you get when you hold down the Option key at startup), you need to reset the Mac's PRAM, NVRAM, and Open Firmware. Shut down the Mac, then power it up, and before the screen lights up, quickly hold down the Command, Option, P, and R keys, until the Mac has chimed twice more after the powerup chime. Then, before the screen lights up, hold down Command-Option-O-F until the Open Firmware screen appears. Then enter these lines, pressing Return after each one:

reset-nvram

set-defaults

reset-all

"The reset-all command should restart your Mac. If so, you have successfully reset the Open Firmware settings."

http://support.apple.com/kb/TS1812?viewlocale=en_US

How to eject a cd from the internal cd drive:

eject cd

List of devices:

devalias

List of variables:

printenv

I don't have original discs that it came with.

Then you still can use the second option with the keyboard combo I posted, called "resetting the PRAM."

Also when you way hold the c key down do you mean turn computer off and turn back on holding the c key?

Yes, or you can simply restart. As you don't have the CDs, this isn't on the plate any more.

The internal backup battery is not expensive and, in most iMacs is user-replacable. If yours has a tray-loading optical drive like this one:

it takes a major teardown to replace the internal battery. If this is the case, you'd be better off to leave the computer plugged in all the time; that eliminates the main reason for having a working battery.

If it has a slot-loading optical drive like this one:

things are much easier. The battery is visible through the RAM access door on the bottom of the computer case. The manual:

http://manuals.info.apple.com/en_US/iMacG3_2000UserManual.PDF

has sketches of how to access the RAM and therefore the backup battery. Unfortunately, the pdf on the manual goes up sideways on-screen and the RAM instructions are pretty deep into the manual. It's probably easier to scroll (for a while) to the section on adding RAM and print the applicable pages.

When you work on the battery, some sort of non-conductive pliers or large tweezer or forceps help unless you have tiny fingers. Make sure to note the polarity of the old battery and install the new one in the same orientation.

The battery itself is readily available. If price is no oblect, you can get it for a small rasom from Radio Shack Store ("Tandy" outside the US) as part number 23-026.

Online, they are dirt-cheap even after adding shipping. I buy backup batteries form this outfit:

3.6v Newer Technology Lithium 1/2 AA PRAM Computer Clock Battery

Because you indicated that the computer "crashes" and (upon restart) can't find the hard drive, I don't think this is a case of a bad PRAM battery. If the battery is bad, it is likely coincidental, but not causal regarding the crashes. After the computer is up and running, a weak/dead internal battery shouldn't cause the computer to freeze/crash. This sounds more like a hard drive with an electronic and/or mechanical problem that stops the flow of data to the processor. When this occurs, the computer will crash. If you have a first-generation iMac, it would be a 1998 model, the year it was introduced. If the problem is caused by a badly-corrupted directory on the hard drive, a third-party program like DiskWarrior would be the best solution to correct it. Unfortunately, you'd need an older/discontinued version of DiskWarrior, if you're not running OS X on that iMac. As suggested, start from the OS installer disk (you'll need to acquire one) and go to the Utilities Folder on the CD to locate and run "Drive Setup" (pre-OS X disk). If the hard drive isn't recognized/found, it will need to be replaced. If you have to pay someone to perform this service for you, you should consider retiring the computer. Even if you replaced the hard drive yourself, investing any $$ in a 14 year-old iMac may be a questionable expenditure of time and money.