The white balance setting adjusts the tones of the movie clip to best match the color quality of the light source.

Outdoors, light quality includes a lot of blue skylight. Indoors, tungsten light is more brown than outdoors. Flourescent light is more green than outdoor lighting.

"Color temperature" is the term used to describe the color quality of light. Color temperature is measured in degrees Kelvin (a very high scale, compared to Farenheit or Celcius) and the higher the number, the more blue the light is.
You won't be measuring color temperature in this class, but there is a device known as a colorimeter that does. It looks a lot like a handheld light meter, but it is actually measuring the quality of the light, not the brightness.

If you have the white balance set for "outdoors" and you are shooting indoors, the resulting image will be too brown. If you set the camera for "indoors" and shoot outdoors, the image will be too blue.

This clip features an outdoor setting....with a subject that is indoors. Then, the camera is adjusted for "indoor" white balance. At first, the background looks good and the subject is too brown. Then, the subject is more correct and the background is too blue.

In this case, you would have to add some color corrected light to the indoor scene, or scrim the outdoor scene with a "gel" that adjusts the color quality of the light in the scene.