In the Google Ads auction, you bid against other competitors for placement in search engine result pages (SERPs). When users type a query into Google, an auction is triggered and each bidder determines how much they are willing to pay for each click. The highest bid wins and that ad gets placed at the top of the SERP. The amount of money you are willing to spend is referred to as Cost Per Click (CPC). This CPC is determined by your budget and the maximum amount you are willing to pay for each click.