There's some discussion and debate as to whether or not dry yeast should be rehydrated...but generally it is a good idea.
What it is is basically waking up the yeasties.
You do it one of two ways, by getting approximately 2 cups of warm water (I go right from the tap) and sprinke the yeast on top of it. After 15-20 minutes the yeast will be foamy. You then stir it up and add it to your fermenter.
The other way is to sprinkle it on top of your wort, then wait 15 minutes and stir it up to mix it.
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