Using Absolute References in MS Excel

When we apply a formula in Excel which refers to another range or cell, the cell or range reference can be wither relative or absolute.  The relative cell reference adjusts to its new location when the formula is copies and pasted in to new cell or range. An Absolute cell reference does not changes even when the formula is copy pasted elsewhere. An Absolute reference is specified with two doller($) signs. For example as mentioned below.
Examples for Absolute references:
=$C$10
=SUM($A$1:$G$25)
Examples for relative references:
=C10
=SUM(A1:S25)
Normally when we use cell or range references which will be relative references. Excel by default creates relative cell references in formulas except when the formula includes cells in different worksheet or workbook.
So where Absolute references are useful? I simple words, this is useful when we need to copy paste the formulas in different cells or ranges.

The formula in the above example table D2 range which multiplies with quantity by the unit price is B2*C2. This formula uses the relative reference. Hence when we copy paste this formula to the next cell D3 it becomes B3*C3.
If we use absolute reference in this formula that is instead of B2*C2, D2*$C$2, copying the formula to the below produces incorrect results. The formula in cell D3 is exactly the same as the formula in Cell D2 and returns the total for laptops and not desktops.
Now let us use the same tablet to calculate sales tax.  The sales tax rate is stored in cell B7. Here formula in Cell E2 is D2*$B$7.

The total is multiplied by the tax rate stored in cell B7. As this is constant for all the items, we need to give absolute references.  This reference do not change when we copy the cell.  When the same formula in E2 is pasted  to Cell E3, the formula becomes D3*$B$7. Here D3 is relative reference hence it changes but B7 remains same.