Photoshop is the 'industry standard' photo editor and pretty much all-around graphics editor. It has a price tag to match that claim.
Paint Shop Pro (I think it's version 10 now) is a decent application that will get you about 80-90% of the functionality of Photoshop, at about a tenth of the price (after PSP discounts).
In the same price range as PSP, and you're looking at around $100 USD but there are almost always discounts of about 20%, would be Photoshop Elements. It has about 90-95% of the functionality of Photoshop, but is more in the range of what a home consumer would be likely to spend.
I started using PSP for image editing about 8 years ago, but quickly switched to Photoshop. I personally find the interface easier in PS than in PSP, but that's a matter of user preference.
PSP offers a 90 day, fully functional trial at Corel Corporation - Home of CorelDRAW, WordPerfect, Paint Shop Pro, Photo Album and Painter. Photoshop Elements has a trial as well, though I don't know how long it lasts. You can find Elements at Adobe.
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