The CPU or Central Processing Unit is the component in the computer which carries out commands by using basic input and output operations of the system.
On larger machines the CPU requires one or more circuit boards however on smaller machines like laptops it is housed in a single silicon chip called a microprocessor.
below is a little movie all about CPUs and what they do...
Computer Hardware Information : How Do Processors Work?
The Clocking Rate
The clock rate is the speed at which a microprocessor executes instructions. Every computer contains an internal clock that regulates the rate at which instructions are executed and synchronizes all the various computer components. The CPU requires a fixed number of clock ticks (or clock cycles) to execute each instruction. The faster the clock, the more instructions the CPU can execute per second.
A little bit of History...
The first commercially sold microprocessor was the Intel 4004 produced in 1971, the 4004 was very good but for its time it was an amazing new discovery in the world of computing. However Intel did not create the CPU as it was created by a man named Frederico Faggin who created the idea and made it first however he did not sell it commercially and Intel sold their one before. Compared to the CPU below the 'Intel Core i7' which is the best CPU you can buy in the moment it isn't very good but many of the best inventions have humble beginnings.