I am VERY new to all this, so please be patient.

My question is:

What is the difference between shared hosting, dedicated hosting, and reseller hosting? I don't know what any of these things mean.

Hello AMCAmanda, first of all welcome to WT.

Take a look at the following thread:
http://webmaster-talk.com/showthread.php?t=11816

You'll find the answers to your questions located towards the bottom of the first post. If you have any questions, just post them here.

Awesome, thank you!

Shared:
You share the server's resources (disk space, memory, processor) with all of the other websites and/or resellers hosted on the same physical server.

Reseller:
Right in between shared and dedicated. Most resellers are on shared servers whether they know it or not. However, this enables you to re-sell your provider's hosting services as your own. You can usually brand control panels to your liking to hide the parent host and show your own logos.

Dedicated:
You do not share the server with anyone unless you want to. You can either use your box to host your high-traffic website, your customer's websites or offer reseller opportunities to other individuals.

Here is the general idea:
1. (shared) single website owner
2. (reseller) sells parent host's services as your own, or just host multiple sites under one account.
3. (dedicated) host your site(s), customer sites and reseller sites

If you can find a provided that is really good with managed dedicated servers (a lot are not), dedicated is the way to go. It may cost you a lot more, but the return on investment is definitely worth it. Especially if you have a customer base you can already start out with.

Dedicated Incentives:
Offer your direct customers 1 month for free for every new customer referral that signs up for hosting. Either that or a flat dollar value to make them want to refer you to their business associates