Indexes are a data structure that contains pointers to the contents of a table arranged in a specific order, to help the database optimize queries. They are similar to the index of book, where the pages (rows of the table) are indexed by their page number.
Several types of indexes exist, and can be created on a table. When an index exists on the columns used in a query's WHERE clause, JOIN clause, or ORDER BY clause, it can substantially improve query performance.
Indexes are a way of speeding up read queries by sorting the rows of a table according to a column.
The effect of an index is not noticeable for small databases like the example, but if there are a large number of rows, it can greatly improve performance. Instead of checking every row of the table, the server can do a binary search on the index.
The tradeoff for creating an index is write speed and database size. Storing the index takes space. Also, every time an INSERT is done or the column is updated, the index must be updated. This is not as expensive an operation as scanning the entire table on a SELECT query, but it is still something to keep in mind.