Literacy means you can use a computer to a basic degree.
Competency means you are highly experienced and capable of using a wide range of applications, performing various tasks, and are able to learn or 'guess' how to utilize new applications based on common experience with similar.
IE, how Microsoft Word is very similar to OpenOffice's Writer.
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Well, in the general sense, literate means you can read and illiterate means you cannot.
So, adding computer to the start would mean that:
Computer literate = can use computers
Computer illiterate = cannot use computers
Based on what I know of those two words (Competent, literate), I'd have to say that computer competency means you know what you are DOING, while computer literacy means you know the VOCABULARY behind it.
Computer literate = someone that knows how to use a computer
Computer illiterate = someone that does notknow haw to use a computer.