#1
Ok, so I understand volume and tone on a guitar, but I was wondering how EQ works.
How do you filter out highs, lows, and mids individually?
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#2
The short, simple, and easy explanation is this:

A resistor and a cap make a filter. The filter is either low-pass (filters out highs) or high-pass (filters out lows) depending on the order of the cap and resistor.

Using a simple formula, you can determine what value cap and resistor (or pot, if it's adjustable) will filter out what frequencies, and thus tailor a string of them to your liking.