Line 2 creates a new String object with the value "XYZ", but this new object is immediately lost because there is no reference to it. Line 3 creates a new String object referenced by y. This new String object has the value "xyz" because there was no "Y" in the String object referred to by x. Line 4 creates a new String object, appends "abc" to the value "xyz", and refers y to the result.