How do multiple hard drives speed up PC performance?

Because sometimes your computer is performing more than one disk activity at once.

Example: you're loading ___MB of game assets from disk #1 while Windows does its pagefile activity on disk #2.

Another reason for a hybrid "fast small disk + slower bigger cheaper disk" strategy is cost. Ideally, you'd have 5TB of fast solid-state storage and no spinning disks. That's not cost effective unless you're the king of an oil kingdom, but most demanding users can probably afford a $250 80GB Intel SSD to speed up OS and key software applications in addition to the 7200RPM drive they were going to buy anyway.

A second physical hard drive will only give you faster I/O throughput when you're copying from one to the other or when otherwise using both disks.

Under most scenarios, where normally you're only using one disk, there is no performance increase.

Because you can read from two different sources at once.

Your HDD can only read one thing at any one time, and to read another it has to move the read head, two drives can have potentially double the throughput (Two identical drives WILL have double throughput in RAID 0)

The idea is to have your operating system installed on the fast drive (the SSD or the Raptor). Any program files, games, applications you install will be stored here and run from here. You take advantage of a really fast read/write, while not wasting money on space that you won't be using.

Then, you get another drive strictly for storage media. This way you can get a cheap 1TB+ drive. Personally I like the WD Caviar Greens cause they run quiet, cool, and power efficient. This won't effect performance of your computer.

The way I have it set up is I have a 10,000RPM WD raptor for my OS, and I have 2 x 1TB WD Caviar Blacks set up in a RAID 0 to make a 2TB drive, and I back that up with a 2TB external.