Stringed instruments have been played for centuries.  They have been played everywhere from Europe to Australia, even in Africa, and everywhere in between.  
They all had different names and some like the ghitara even seem directly related to the guitars of today.  When and where the first guitar was made isn't exactly known, but some speculate that it was originally made in Greece.  The reason I would assume that the first guitar was made in Greece because there were great geometers and scientists in ancient Greece.  These Geometers understood that the thickness, or gauge, and how long or short a string is determines its pitch, or how high or low the sound is and how much it vibrates which determines how loud it is. So yeah that's where I think it was created originally.
Originally guitars were acoustic.  They were acoustic because there was no electricity to power amplifiers with.  Because of that they had to use wood arranged to form special chambers to amplify sound.  That's all you need to know about where and how guitars were created.
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