Keyword: A word or an expression that is likely to be searched by users of search engines.

Ad: An advertising message, usually made of a title and a short promotional text. Ads are usually attached to keywords (Yahoo Marketing) or groups of keywords (Google Adwords).

PPC: Pay Per Click. You are only charged when someone clicks on one of your ads.

Conversion Rate:
Percentage of visitors to your site that end up making a purchase.