A Layer 2 switch is used to direct traffic based on MAC addresses and segments a network into separate collision domains by keeping separate traffic on each port, thus reducing collisions. A hub, which is a more rudimentary device, does not segment collision domains but rather repeats the signal to all ports, increasing the likelihood of collisions. A router connects different networks and directs traffic based on IP addresses, not MAC addresses. Lastly, a bridge is used to divide a network into segments, but it's less common and not as advanced as a Layer 2 switch for handling traffic within a single network.