how does file storage work

if I download a file then it is saved in Downloads folder. If I then save it to Documents folder, do I now have two copies of the same file (one in each folder)

If you 'move' it, e.g. by simply dragging then the icon will disappear from Downloads and appear in Documents. No second copy will be made.

If you 'copy' it, e.g. by using the Copy/Paste menu items or holding down the Opt modifier key while dragging, then the original file and icon will remain in Downloads and a new file and icon will be created in Documents and additional space will be used on the disk.

If I download a photo, then import to Photos App, is the photo now double on my hard drive? Can I delete the photo file from downloads and have the photo still be fine in my Photos App?

Yes and yes.

Or If I used iPhoto before and have an iPhoto library, then moved all photos to Photo App...do I now have duplicate libraries on my Mac requiring double the space?

No. There is a built in system to 'deduplicate' files shared between iPhoto and Photos. This can be broken if you export the image thereby converting it to a file and then import this back into Photos. But if you have just clicked 'Okay' to the dialog that offered to import your iPhoto library into Photos the 'toll-free' sharing should 'just work'.

I am simply looking for a link to help me understand how the file storage system works. Thank You.

If you are a new user and just want a simple introduction:

https://www.apple.com/uk/support/macbasics/

otherwise Google for:

os x documents folders alias move copy duplicate

to find lots of descriptions in various levels of detail.

MacOS Sierra has introduced some new features to help users avoid creating multiple redundant copies of files but the underlying basics have not changed.

C.

There are several such applications in the App store.

Be careful using them; a few duplicated files is not so bad in the grand scheme of things. Restrict the scope of their searches to places you expect there will be duplicates and only delete duplicates of large files that will save a worthwhile amount of space and that you are satisfied really aren't duplicated for a reason.

C.