I'm learning about the game development. No i'm on the total basics - writting a proper game loop. As i've searched over the Web i'v found that simple but good working pattern using so called fixed time step:

double previous = getCurrentTime();
double lag = 0.0;
while (true)
{
  double current = getCurrentTime();
  double elapsed = current - previous;
  previous = current;
  lag += elapsed;

  processInput();

  while (lag >= MS_PER_UPDATE)
  {
    update();
    lag -= MS_PER_UPDATE;
  }

  render();
}

I roughly understand the logic behind this piece of code but i have the question regarding the game composition. What exactly the update function do and what the render function. What's their responsibility? Am i assuming right that in the super simple 2D game the update function can for e.g. calculate the distance in pixels the object (e.g. a Car) should move in the next frame and the render function in such a case just takes this calculated position and draws the Car on the screen? Correct me if i'm wrong and please provide some example/s.

Thx.

PS. Sorry for such a basic question but i'm really beginner.