CGI scripts are usually kept in a separate directory from plain HTML files. This directory is most commonly called cgi-bin (the "bin" stands for "binary" but really just means "executable files", whether compiled binaries or interpreted scripts such as Perl programs). The web server is usually set up so that you only have permission to run CGI programs from the cgi-bin directory, for security reasons.
Change to your public_html directory
If you type ls to get a directory listing, you will see that you have several HTML files here, as well as a cgi-bin directory.
Change to your cgi-bin directory and type ls, and you will see that the example scripts for this course are already installed here.
If you were setting this up for yourself, you would need to be sure of the following:
That your home directory is world executable
That your public_html directory is world executable
That all your HTML files are world readable
That your cgi-bin directory is world executable - note that it is not compulsory to have a cgi-bin directory - some server configurations allow you to execute a CGI script from any directory.
That all your CGI scripts are world readable and executable