What is the difference between Product Assembly & Component Assembly In Catia?

In Assembly Environment there are two options insert component or product so, what does it actually mean?

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It means that you can assable products in yout product. Some times it is easier to assamble some parts to a product, and import them as a product in your general product.
So you can reduce your number of constrains, etc

 
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Component does not have file i.e. we can add the parts into components and by copying we can use number of times within a CATProduct, without generating lots of file.

 
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