Bonus Question: Do computers know the difference between the Latin alphabet and Chinese characters? Go ahead and talk about that in the comments.
Characters...how do they become strings? Let's talk about Arrays for a moment. Arrays are collections of primitive data types, and characters are a primitive data type. So are words arrays of characters? Yes, but a string can include more than one word. In fact, one of the characters in a two word string would be a space. That's right. Space is a character, so a string containing "one two" is a single string exactly 7 characters long.
So strings can be individual words. They can also be multiple words. They don't even have to be words that make sense to you or me. How many characters can a string have? That's when you get into the specific implementations of programming languages. Fortunately, while it's a good question for you know the answer to for whatever languages you choose to use for programming, it's also not a question I have set out to answer.