"ISP" stands for Internet Service Provider. The ISP is a host computer which has a permanent connection to the Internet. When you ring this computer with your modem it will answer the call and then make a connection, through it, to the Internet. You can think of it as a interpreter. You are not directly speaking to it but it picks up your questions, translates it, receives a responses and translates that response for you to understand. That give you a basic understanding of what the ISP does. How the Internet actually works is better left for books and other web sites which specialize in the ways of the web.
Costs of the Internet