Explain the process of Google Auction?

The Google auction process is as follows:

• When a user enters a search query, AdWords displays a list of all keywords related to it, having an exact match, phrase match or variation.
• From these ad sets, ads which are not eligible as in have a different target country or have been disapproved, will be filtered out.
• From the remaining ads, only those with a high Ad Rank will show genuine results.