Help Confused about downloading music from Play Store


I was always under the impression that songs I purchased from the Play Store were downloaded to my phone. Now I suspect otherwise, and have the following questions:

* Are the songs purchased and just streamed every time I listen to them?
* If so, can I stream them to other android devices without paying again?
* Is there an option to download the songs directly to my phone?
* If so, do I need an SD card to do this?
* Is music downloaded from the Play Store in MP3 format?

Sorry for so many questions, but I'm really confused.