If computer understands only binary then why octal and hexadecimal are used

Answer 1

Because they make more easy visualization and operations between data than binary

Answer 2

Hexadecimal and octaldecimal are for humans to read not machines. Binary can also get long really fast a 64 bit number has to obviously be represented with 64 binary digits meanwhile it takes a few hexadecimal characters.

Answer 3

Conversion between binary and hex is easy (easier than binary to decimal) because hex is a power of 2.
Hex being very concise, with still a limited number of characters (ABCDEF) in addition to digits, it makes it much more readable and easy to memorize by humans than binary.