Open Source Software (OSS) is provided with a license that gives the end user the right to use it freely for private or commercial use. You also have the right to inspect and even modify the underlying source code. You can give away or sell the original version you received or one with your modification, provided that you then in turn pass on the modified source code so that others can benefit from the changes you have made. This last clause protects the developer's work from unfair exploitation by others, while allowing the source code to be released to the community. You are not required to pay royalties to previous developers, but you are still permitted to charge money for the sale of OSS. This disc may have been given to you by a friend; or sold to you for a small fee, and both are permitted.
If you have no interest in source code, you may ask why the availability of this matters. One answer is that the release of source allows external observers to inspect the true functioning of the program, which means that you can be confident that the program treats your private data with respect. A real problem with proprietary software can be that your data is locked in to a software's proprietary file format, which means that you may eventually be forced to upgrade to newer versions of that software to retain access to your data. This does not happen with OSS, because when the source code for opening and saving files is available, a third party can easily write an import filter for the next generation of software, ensuring that your data will always be available.
Finally, the release of source code has in some cases spawned large communities of volunteer developers who have in turn provided the world with highly useful, and entirely free software such as Linux, OpenOffice, and Mozilla. These are then available free of charge to schools or anyone else who may not have a large budget available for software. So, you can see that the freedom of software is important for everyone, not just software developers.