The CPU or processor is a microchip that handles instructions and commands. It processes this information, and the faster it can do this means the quicker and smoother the computer will perform, and the more complex tasks it can carry out.
Intel are always pushing the boundaries of technology so their processors are continuously improving / evolving. Since new processors are more efficient than the devices they are replacing, this generally means that a newer computer (of a similar specification) will be quicker, run cooler and be more energy efficient than previous models.
This video does a good job of explaining why one CPU is better / faster / more expensive than another.
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