A switch,  keeps a record of the MAC addresses of all the 
devices connected to it. With this information, a switch 
can identify which system is sitting on which port. So when 
a frame is received, it knows exactly which port to send it 
to, which significantly increases network response times. 
And, unlike a Hub, a 10/100Mbps switch will allocate a full 
10/100Mbps to each of its ports. So regardless of the 
number of PCs transmitting, users will always have access 
to the maximum amount of bandwidth. It's for these reasons 
why a switch is considered to be a much better choice then 
a hub. 

Routers are completely different creatures. Where a hub or 
switch is concerned with transmitting frames, a router's 
job, as its name implies, is to route packets to other 
networks until that packet ultimately reaches its 
destination. One of the key features of a packet is that it 
not only contains data, but the destination address of 
where it's going. 

A router is typically connected to at least two networks, 
commonly two LANs or WANs or a LAN and its ISP's network 
(ex. your pc or workgroup and EarthLink). Routers are 
located at gateways, the places where two or more networks 
connect. Using headers and forwarding tables, routers 
determine the best path for forwarding the packets. Routers 
use protocols such as ICMP to communicate with each other 
and configure the best route between any two hosts. 

A router will typically include a 4-to-8 port Ethernet 
switch (or hub) and a Network Address Translator (NAT). In 
addition, they usually include a Dynamic Host Configuration 
Protocol (DHCP) server, Domain Name Service (DNS) proxy 
server and a hardware firewall to protect the Local Area 
Network (LAN) from malicious intrusion from the Internet.