How can I tell if my hard drive crashed

I've had my MacBook for slightly more than one year and for no reason that I can think of it will only boot up to a screen that looks like an apple with a problem. I took it to an Apple store and they told me that he hard driv crashed and it would cost $700 for a new one. I paid $1000 for it brand-new. Any suggestions to determine if it is the hard drive and how I might be able to salvage what's on it/get it going again? Please help!

Try this first:
Extended Hard Drive Preparation
1. Open Disk Utility in your Utilities folder. If you need to reformat your startup volume, then you must boot from your OS X Installer Disc. After the installer loads select your language and click on the Continue button. When the menu bar appears select Disk Utility from the Installer menu (Utilities menu for Tiger or Leopard.)
2. After DU loads select your hard drive (this is the entry with the mfgr.'s ID and size) from the left side list. Note the SMART status of the drive in DU's status area. If it does not say "Verified" then the drive is failing or has failed and will need replacing. SMART info will not be reported on external drives. Otherwise, click on the Partition tab in the DU main window.
3. Click on the Options button, set the partition scheme to GUID (only required for Intel Macs) then click on the OK button. Set the number of partitions from the dropdown menu (use 1 partition unless you wish to make more.) Set the format type to Mac OS Extended (Journaled.) Click on the Partition button and wait until the volume(s) mount on the Desktop.
4. Select the volume you just created (this is the sub-entry under the drive entry) from the left side list. Click on the Erase tab in the DU main window.
5. Set the format type to Mac OS Extended (Journaled.) Click on the Options button, check the button for Zero Data and click on OK to return to the Erase window.
6. Click on the Erase button. The format process can take up to several hours depending upon the drive size.
This will erase any data stored on the drive, so I hope you have backups.
If the drive still cannot be made functional or the SMART status indicates the drive is failing, then you will need to replace it. It won't cost $700 and you can do it yourself: MacBook (13 inch) Hard Drive Replacement Instructions (Do it yourself Manual).
Replacement drives can run from $50 to $350 depending upon size, make, model, and speed. You can find replacement drives at OWC. Your computer can use any 2.5" notebook SATA drive up to 320 GBs. Only Samsung makes a 500 GB drive that will fit in a Macbook.

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