The Goal
The password for Level 3 is stored in a file named --spaces in this filename--
in the home directory.
The Approach
Spaces in filenames trip up the shell because it uses spaces to separate arguments.
To open a file with spaces, each space needs to be escaped with a backslash (\ ).
Tab completion is particularly helpful here since the shell will auto-escape the spaces:
bandit2@bandit:~$ cat ./--spaces\ in\ this\ filename--
password
Commands Covered
cat ./name\ with\ spaces, open a file with spaces in its name using backslash escaping