Please read the following carefully: throughout this book you will frequently see the variable name $LFS. $LFS must at all times be replaced by the directory where the partition that contains the LFS system is mounted. How to create and where to mount the partition will be explaind in full detail later on in chapter 4. In my case the LFS partition is mounted on /mnt/lfs. If I read this book myself and I see $LFS somewhere, I will pretend that I read /mnt/lfs. If I read that I have to run this command: cp inittab $LFS/etc I actually will run this: cp inittab /mnt/lfs/etc
It's important that you do this no matter where you read it; be it in commands you enter on the prompt, or in a file you edit or create.
If you want, you can set the environment variable LFS. This way you can literally enter $LFS instead of replacing it by something like /mnt/lfs. This is accomplished by running: export LFS=/mnt/lfs
If I read cp inittab $LFS/etc, I literally can type cp inittab $LFS/etc and the shell will replace this command by cp inittab /mnt/lfs/etc automatically.
Do not forget to set the $LFS variable at all times. If you haven't set the variable and you use it in a command, $LFS will be ignored and whatever is left will be executed. The command cp inittab $LFS/etc without the $LFS variable set, will result in copying the inittab file to the /etc directory which will overwrite your system's inittab. A file like inittab isn't that big a problem as it can easily be restored, but if you would make this mistake during the installation of the C Library, you can damage things.
One way to make sure that $LFS is set at all times you could add it to your /root/.bash_profile and/or /root/.bashrc file(s) so everytime you 'su' to user too as to install LFS, the $LFS variable is set for you.