An Oracle database server consists of an Oracle database and Oracle instance. An Oracle instance is made up of memory buffers known as the System Global Area (SGA) and background process that handle much of the behind-the-scenes work involved in running an instance.
The instance is idle(nonexistent) until it is started. When the instance is started, an initialization parameter file is read and the instance is configured according to instructions contained within the parameter file.
After the instance is started and the database is opened, user can access the database.
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