To explain the hosting services in simple way possible, we are going to use simple reference.
First, to build your house, you need space or land, right? Similar way, you need space to build your website.
Now coming to the domain, it is nothing, but an address to visit your house. So, domain is a path to find your website.
A hosting package comes in different categories like Linux web hosting, Windows, and Cloud.
Linux web hosting is the cheapest one, while could is the most expensive one.
To host a localhost website, you can select Linux web hosting package, if you are running a heavy site, then move to cloud.
Coming to the Windows host unlimited, the price is slightly higher than Linux web hosting, so it better that you avoid Windows package unless you have a web application to run on the website.
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