What is Elastic Load Balancer (ELB) in AWS and how does it work?

I'm learning AWS and cloud computing, and I often come across Elastic Load Balancer (ELB). I understand that it distributes incoming traffic across multiple servers, but I'm not sure how it works or why it's important for scalable and highly available applications.

Can someone explain what Elastic Load Balancer is, the different types of ELBs (Application Load Balancer, Network Load Balancer, Gateway Load Balancer, and Classic Load Balancer), and when each should be used? A simple real-world example of how ELB improves application performance, reliability, and fault tolerance would be very helpful.