Oracle's cost-based SQL optimizer (CBO) is an extremely sophisticated component of Oracle that governs the execution for every Oracle query. The CBO has evolved into one of the world's most sophisticated software components, and it has the challenging job of evaluating any SQL statement and generating the "best" execution plan for the statement.
Because the CBO determines the execution speed for every Oracle query, the Oracle professional must understand how the CBO is influenced by Oracle external issues, internal statistics, and data distribution.
Read more about the Oracle Optimizer here:
http://oracle-tips.c.topica.com/maamADPabMv0pbLGJrib/
Cost Control: Inside the Oracle Optimizer
