Well it all depends on your budget, I build the computer I'm using now for about $500 give or take (not including monitor) and it can play games such as the orange box and oblivion on max settings and games along the lines of empire total war on high.
The purpose of the processor is to be do just what it says, process things. I like to think of it like the "brain" of a computer in a loose sense. Processor speed is measured in gigahertz (ghz), the higher that number is, the faster it will be. For games high spec games I would get something that is about 3.0 ghz dual-core or higher.
The other factor that will really determine how fast your processor or CPU (central processing unit) is how many cores it has. Most CPUs for sale are dual-core but there are some that are quad-core or single-core. For games don't get a single core. If you want to go on the cheaper side get a dual-core processor with a 3.0 ghz or higher speed. If you want to get a quad-core then more power to you, but you will find them more on the pricy side. If you decide to get a quad-core processor then look for one about 2.4ish ghz or high speed.
Now, RAM ("random access memory" or often referred to as memory) is what is used for getting information that has been temporarily stored on it. RAM comes in 3 flavors that you will find for sale, DDR, DDR2, and DDR3. The RAM you get all depends on what your motherboard will take; most RAM for sale will take either DDR2 or DDR3. DDR3 is a faster RAM than DDR2, like quad-core processors it comes at a higher price. Memory is measured in Gigabytes (GB).
Computer games for the most part don't really use all that much RAM in relation to it's price. Most RAM will also have a number next to the DDR type in the title it which is its speed. So If I had saw a title for some RAM for sale it might read something like this: "Kingston 4GB (2 x 2GB) 240-pin DDR3 1333 Memory Kit". This would tell me that Kingston is the brand type, the total amount of RAM is 4GB, it consists of 2 sticks of 2 gigabytes of memory each ((2 x 2GB)), the pin count is 240, and it is DDR3 1333 RAM. If you just make sure of what memory type your motherboard takes it should be a fairly easy task of selecting ram.
Not to terribly much to say about a hard drive, it stores data on it and retrieves data form it. First when buying a hard drive make sure it is a 3.5" drive and not a 2.5" drive. A 3.5" drive is supposed to fit in a desktop but a 2.5" drive is supposed to fit in a laptop. Most all hard drives today use the SATA cable interface which is just a small red cord that fits into your hard drive and motherboard (if your motherboard has SATA ports, almost all new ones do). The size of your hard drive is measured in either gigabytes (GB) or terabytes (TB). One terabyte is equal to 1000 or 1024 gigabytes depending on who you ask.
Monitors are all about preference, whether you want wide screen or full screen and the size. The size of a monitor is measured in inches much like a TV. A monitor will also have a resolution which is good to know when setting a resolution on a game to make it look it's best.
For the operating system I would have to say windows vista for the fact that it supports directX10. If you buy windows vista OEM then you can get a sheet that will offer you a free upgrade to windows 7 when it comes out on October 22nd. Also when buying an OS you want to know whether it is 64-bit or 32-bit, a 32-bit OS can only recognise 3GB of RAM which is not good. I recommend getting windows vista 64-bit.
For "Graphics Capability" that would be the graphics card. Now graphics cards fit in a bunch of different slots but the newer and most powerful cards fit in a slot called a PCI-Express 2.0 x16 slot (PCI-E2.0x16) which is what you want.
Other important features and peripherals are the motherboard which is what everything fits into, the case of the computer to see if it gets good cooling, and a mouse and keyboard are always nice to have.
Depending on what graphics card you have you may want to look for a motherboard that is either Crossfire for an ATI card or SLI for an Nvidia card. What Crossfire and SLI allow you to do is hook up 2 graphics cards in the same motherboard.
The price for all of these things will vary quite a bit, especially if you plan on building a computer or buying one premade. Check the sources for probably the best website for buying anything you will need for your computer.