Eclipse "\Android Private Libraries" vs "\Referenced Libraries"

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I've noticed that some libraries need to be added to build path manually (i.e. "Referenced Libraries") whereas other libraries works fine if I simply put the jar in \libs folder (i.e. "Android Private Libraries").

For example android support library works fine if it is manually added to the build path, But what is the reason?

I haven't understood what is the difference and when I should choose one option over the other and vice-versa.

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