moreover, i'm a bit confused, when editing a photo that was shot in raw, do you save it at jpeg then work with it? or work with it in raw then save it as a Jpeg? the reason i'm asking is because i saw the option in viewnx that came with my nikon where i can convert to jpeg. but i always was under the assumption that you edit the photo while it's sitll in raw, then save it as a jpeg.
Several points:
1. JPEG and RAW formats exist only as disk files. Anytime you see and image on screen the image you see is
no longer either JPEG or RAW.
2. There are two classes of software, image editors (e.g. Photoshop) and RAW converters (e.g. Adobe Camera RAW, Nikon Capture NX, ...)
3. There are thousands of different workflow that are possible. There is no one way to handle images.
The answer to your question depends on your definition of "work on an image".
When you open an image in a RAW converter you are presented with a surogate image generated from the RAW data using some default settings that the software chooses. You then make adjustments to those settings and they are applied to the RAW image to create a new surogate to view. When you are done the software processes the original RAW data to generate the desired output or it simply saves the settings as a script to use as starting points for some later conversion.
How the converted image is output depends on the software. Standalone RAW converters (e.g. Nikon Capture NX) can output to a printer or to a file. You have a choice of file formats with most software (CaptureNX offers JPEG and TIFF). Plugin software (e.g. Adobe Camera RAW, aka ACR) outputs by sending the image to the host application (Photoshop, Photoshop Elements, ...) in that application's native memory format (not anything you've even seen in disk file form) for further true image editing before final save. Some applications have plugin-type RAW converters that are embedded in the host application. The only difference between these and true modular plugins is that they can't be interchanged manually; you have to update the whole application to update the converter.
Most photographers that regularily shoot RAW will use either a good image editor with a good plugin converter (e.g. Photoshop & ACR) or a high-power standalone converter (e.g. Nikon Capture NX), if one is available for their camera's RAW flavor, that offers localized settings (e.g. different conversion settings for different portions of the picture) and a few image editor like modification tools (red eye removal, dust removal, ...).
Some use both a standalone converter and a powerful image editor, prefering one app for its convertions (degree of control, subtle qualities in the image, ...) and a true image editor for more powerful image manipulation. Good practice demands that you
never use JPEG as an intermediary file format for moving images between two apps. TIFF is excellent for the purpose. JPEGs should only be used as the final (read: never to be opened and edited again) image.