The fuse contains a piece of wire that melts easily. If the current through the fuse is too great, the wire melts and breaks the circuit. Fuses in plugs are made in standard ratings. The fuse should be rated at a slightly larger current than needed for the device. If the device works at 10A, use a 13A fuse.
Cars also have fuses.
The car could catch fire if there were an electrical fault, so all the circuits have to be protected by fuses. The earth wire gives a safe route for the current if the live wire touches the outer casing. If the live wire inside an electric cooker comes loose and touches the metal casing, you will get an electric shock. The earth terminal is connected to the metal casing, so the current goes through the earth wire instead of through you. The earth wire route has a very low resistance, so a big current flows which blows the fuse, disconnecting the cooker.