Hi slimmyweight
Thanks for pointing out any ambiguity.
Although your question is quite straightforward this is a long winded answer, that’s to avoid any misunderstanding.
Layout and Thumbnails:
Different themes have different layouts; for example a full-width layout would go right across a screen whilst a boxed layout may go part way down the middle and have padding / space either side. This means choosing your image and size (length / width) is likely to be influenced by the structure of your theme’s chosen layout. as too personal design preferences.
I’ll use the WordPress Twenty Seventeen theme as an example:
https://www.ads-software.com/themes/twentyseventeen/
the top part has a large image spanning the entire screen across
on scrolling down the layout changes and the use of image is then appropriate for that area. The image used is (as far as I am aware) a featured image (also referred to as a thumbnail).
https://developer.www.ads-software.com/themes/functionality/featured-images-post-thumbnails/
As the site is responsive, the image will resize according to media usage.
The important thing to be aware of is that when we use the term thumbnail, we refer to a Featured Image
as pointed out by yashitamittal11 the images are automatically created at different sizes
to see this, if you have FTP, you could go to your site’s folder and you’ll see lots of images, all the same image at different sizes (these are the ones automatically created), you will have added one and the others were automatically created (of course, only if you have uploaded some)
you can also go to your Dashboard >> Settings >> Media to get an idea of what WordPress is doing with your image uploads
Not so long winded answer:
Thumbnails are used in posts / pages as Featured images (they tend to be automatically resized by your WordPress theme so can be reused as and when required, for example a search result may use an even smaller version, a mobile screen may use a different size)
https://codex.www.ads-software.com/Post_Thumbnails
Most themes are responsive so resize with media queries which is in the CSS
Hopefully, this has helped, if you need an area to be expanded, let me know and I’ll try.