| Do you know what vectors, rasters and bitmaps are? They each can refer to several different things, but basically a vector image can be resized without any loss in quality, rasters are the basic layer type used in most graphics software (like photoshop), and bitmap is a term applied to most image file formats.
To design a website, many steps must be taken. Take for example Midorea's layout: first an idea was proposed. We built off of that idea and created the first concept, which was basically an image of what we wanted it to look like. Once the final design was decided on, the image had to be broken down into the many parts that make up the layout, such as the navigation and footer which are all separate images.
Next the layout had to be coded, which is basically the "skeleton". If you go to view>page source you'll see the code that makes up Mido's layout. All of that had to be coded from scratch.
(some of the code was created by people not affiliated with Midorea, just so we're clear)
The image you posted is a painting that was done in OpenCanvas. OC is geared more towards art than it is for graphics.
The rounded corners/shadow was an effect added to it in PaintShop Pro 8.
Free Software for web design:
Paintshop Pro 8 - Graphics/image editing. Kinda like photoshop, but is better suited for beginners. You can paint/draw with it too, but just barely.
Photoshop - More advanced graphic/image editing. I also do all of my art with PS as well. =)
Gimp - free graphics/image editing software, kind of like photoshop.
Notepad - free, and comes with windows. XD great for coding.
Notepad++ - free, but more advanced than notepad. designed for coding.
I'm not saying you need all of this to design websites. Everyone is different, so what I like to use may not be something you'd be fond of.
Also, if you're going to do any kind of web design, don't use internet explorer. Get a really good browser! It'll make all the difference.
If anyone has any other questions regarding web design/graphics/art/coding, feel free to ask me. :3
Hope this helps in some way. 
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