what configuration for this specially in cache_dir?

hello all
iam still new in squid cache world
i have a squid with ubuntu distro on cumputer with dual core cpu and 2gb ram and 1TB hdd
i want to know what the configuration i must do for this hard ware
specially in cache_dir because i hear many ways for the cache_dir option and iam wasted now !!
what is the most important things i must do in the configuration file to get the best performance
i have squid near the network and i want to make it cache every thing to save my bandwith and make fast browsing
i need help please guys

Actually, the Squid cache is enabled by default, which helps accelerate the loading of some pages. The default allocated size is 100 MB(found in /var/spool/squid). To change its size,edit the /etc/squid/squid.conf file. Find the line:
# cache_dir ufs /var/spool/squid 100 16 256

Edit it. You can change the value 100 by what you want (eg 200 for 200 MB):
cache_dir ufs /var/spool/squid 200 16 256