You're perfectly right. PBKDF2 (Password-based Key Derivation Function 2) takes your password as an input, derives a key from it and outputs that. This key is t

You're perfectly right. PBKDF2 (Password-based Key Derivation Function 2) takes your password as an input, derives a key from it and outputs that. This key is then fed into an encryption algorithm like AES in order to actually encrypt anything.