Please explain folder/path when using #include

Using Arduino Programming Questions
1

I found this while perusing the arduino.h file in C:\Program Files (x86)\Arduino\hardware\arduino\avr\cores\arduino:

#ifndef Arduino_h
#define Arduino_h

#include <stdlib.h>
#include <stdbool.h>
#include <string.h>
#include <math.h>

#include <avr/pgmspace.h>
#include <avr/io.h>
#include <avr/interrupt.h>

#include "binary.h"

Somewhere there must be a list of path= statements because none of the files indicated in the #indlude's are in the folder with "arduino.h". Nor is there an avr/ subfolder. Is there a text file that can be edited somewhere? I already ruled out my computers system variables path as a possibility

2

The files referred to by #include are in the libraries directory(ies)
The files referred to by #include "file" are in the same directory as your .ino file

Because of the way the IDE works it cannot use anything more complex than that.

...R