What is AdSense™?
Google AdSense™ delivers relevant text and image ads that are precisely targeted to the website on which they appear and to the website content.
Google puts relevant CPC (cost-per-click) and CPM (cost per thousand impressions) ads through the same auction, and lets them compete against one another. The auction takes place instantaneously, and, when it's over, AdSense™ automatically displays the text or image ad(s) that will generate the maximum revenue for a page -- and the maximum revenue for you.