Originally Posted by linuxman2
I was thinking it is based on the source path entered ending with a file path and the destination being a directory, but was not sure.
At first, AlucardZero is totally right with his answer.
Just a side note, you can also copy multiple directories into one target directory. for example:
cp -r /etc /home /mnt/backup
which will copy the /etc and /home directories to a (previously mounted) backup directory.