Bandwidth or Data Transfer or Web Traffic what is the difference?
Too often, web hosts talk about bandwidth and data transfer in the same breath, but they are different, although very closely related. Bandwidth is how much data can be transferred at a time [in our case we have a 100mbit/s Connection], and data transfer is how much data is being transferred.

Think of it this way. If bandwidth were a tunnel, then the bigger the tunnel is, the more vehicles can pass through it. In comparison, data transfer is the number of vehicles allowed in the tunnel in, say, a month. In essence, data transfer is the consuming of bandwidth.

How it affects your site
The less bandwidth you have, the slower your site loads, regardless of the visitor's connection type. If you have more visitors, some of them will have to wait their turn. The less data transfer you have, the more often you'll find your site unavailable because you've reached the maximum allowed until a new month rolls by or you upgrade your account.

Determining your requirements
Usually when a host talks about bandwidth, they are referring to your monthly transfer limit. So you need to figure out what is sufficient for your site to function. You'll need to gather some information; this is fairly easy to do if you already have a site. Most of this information is available from your traffic history. If you don't have an existing site, provide an optimistic estimate if you intend to heavily promote the site. Then get ready for some math.

Find out the daily averages of:

Number of visitors / expected number of visitors  [ Note this is Total Visitors NOT Unique Visitors ]
Page size including the graphics of the page, remember to add any Video / Animations size these generally are very large and can add up very quickly
Page views / expected pages viewed by each visitor
Then, multiply them as follows:

Visitors x Page size x Page views x 30 days = Monthly Website Transfer

You should also throw in a small margin or error to take into account email traffic and your own uploads to the server. If you offer downloads, then you should add the following:

Average/Expected downloads x File Size x 30 days = Monthly Download Transfer

FTP Data transfer: [ie adding files to the site]
It’s also important to realize that you must calculate amount of files or data transmitted to the site and from clients via FTP (Fine Transfer Protocol ) applications or file management system as part of data transfer. This may not consume much Data Transfer. However, for those that engage in frequent data, content, or image changes, they’ll end up increasing Data Transfer on a large scale.

Also, it should be noted that files and digital data such as music, movies, and software downloads must be considered before uploading them. Many visitors play and listen to or watch music and video files on websites or download them onto their hard disks; both activities could increase Data transfer consumption at alarming rate. The only precaution is to limit their uses on the website.

Keep in mind some you  also need to add other webtraffic of your webhosting account to the total Data Transfer, such as, POP3, iMap and Web-based emails, and your own web traffic in the control panel and file manager when uploading or editing files.

Don't confuse this with Disc Quota