My 2 cents...
Every keyword has a price, we'll use a ballpark of .05 to $1. You pay more for your keywords in order to get on the first page, as Rob111 stated so, based on the popularity of the keywords you have chosen to use, you can watch the price literally go from .05 to $1 if you want to be tp be on 1st page.
Please know that you pay for the keyword that resulted in the click (ie pay per click -PPC) on your ad and the price varies - whether or not the customer actually purchases the product (affiliate site). You also set the amount of money you want to spend daily. Of course, Google has a tool that will tell you what would be the best keywords to result in a click and of course all those keywords start out really really cheap until the ad goes live and you now have to compete for 1st page. Your goal is to choose inexpensive keywords with the least amount of competition but that result in qualified clicks - there's that "niche" phrase again.
Some products, I was able to sell all day but then there were others that I could get customers to click on but they'd get to the product site and.....nothing. Another paid for click that didn't result in a sell.
In addition, Google has separate Campaigns and you want to be careful not to have ads in Campaigns that are competing for the same keywords. For instance, it wouldn't be a good idea to have two ads both competing for "work from home" as one ad may only have to pay .20 for that keyword and be on the 1st page whereas the other will have to pay $1 to get on the 1st page - doesn't matter if the products are the same or not. I think this is Google's way of preventing you from waxing rich on a good selling product. Think about it, if you could write a good enough ad to result in a click and the product site is so good it will sell it's self AND you're able to get keywords "work from home" for .20 - Why not just duplicate the same process with multiple ads that you KNOW sell using the same keyword?
I say all that to say, you'll go throught that $25 really fast starting out but...now that I think about it, it maybe a good investment if you create an ad to draw traffic to your own website. I've heard, in that past, that some people have used this as a way to see "if" there is any interest in the niche they are interested in creating a website for. The site doesn't have to be fully functional - your research would come from the number of clicks you get. I read this long long ago so Google may have disabled the ability to point an ad to a nonfunctional site; however, I'm not sure why, they'd still get paid per clicks.
Hope this was a decent overview.
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