Indexing is simply the work the Search Engine Robots do to give you information on book hotels. How does an indexing robot decide what to index? Well they just send their Bots or Spiders to crawl the web looking for book hotels on web sites.
If an indexing robot finds a document that contains book hotels, it may decide to parse it, and insert it into its database. How this is done depends on the robot. Some robots index the HTML Titles that contain book hotels and keep them in their database. Others will look for book hotels in the first few paragraphs, or parse the entire HTML and index all words.
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