Most people new to web tech and owning a website do not really make the distinction between Pay-Per-Click and Affiliate advertiser programs. So I will attempt to break it down simply and logically for beginners. Let's begin with the more popular and widely used type of advertising... Pay Per Click.

Since I know that people do not like to read anymore I will keep it short and sweet.

Pay-Per-Click

There are several big companies that will help you run pay per click type ads on your site(not just google). These ads are random and usually programmed well to match the type of content your pages have. You can choose image banners be displayed, or only text links be displayed. When a user clicks on these ads from your web pages you receive a tiny "commission". The rates are usually based on 1000 clicks, and with healthy traffic you can make some healthy money. Payouts are usually monthly, and a certain amount must be reached before Payout occurs. You cannot click your own ads.

Affiliate Advertising

Affiliate advertising is different system altogether. When you affiliate with an advertiser you choose the exact ads you want to display and they usually  do not randomize. Clicks get you nothing, but if a user buys anything while at the advertiser site you get a hefty commission. So it is not as constant or frequent, but has a bigger payout when it does happen. The user is then tagged to your affiliate account usually for a certain time period, and if they purchase something else 3 days later you get paid for that too! So these are commissions based on sales exclusively, as opposed to pay-per-click which are commissions based on clicks. You can click your own ads, just not sure if buying under your own site navigation is allowed. lol