Photoshop can do anything to an image. Just like a darkroom ...
A darkroom lets you composite images, add people and objects that aren't in the negative, remove ones that are. It allows you to radically alter tones or colors, selectively lighten or darken, sharpen or blur. Crop. Distort. Create strange, strange effects.
Photographers have been doing all these things in traditional darkrooms with traditional materials since the middle of the nineteenth century. It just happens that most photographers choose to use the darkroom in less assertive ways.
Photoshop lets do everything a darkroom does, but with greater ease and precision. This is true for all the radical maniupulations of pictures (which may or may not interest you) and for the more conventional ones, like controlling the tonal curve, burning and dodging, removing dust spots, etc. etc...
Personally, I'm not interested in using photoshop for "editing," if by that you mean substantively manipulating the content of an image. I use it the way I used my darkroom: to control colors and tones so I can make the best prints I can from my negatives. It's an amazing tool for this.
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