[FONT=arial, sans, sans-serif]How does Google Adwords decide which ads will appear higher in ranking? Is there any tutorial on this?[/FONT]
search the adwords help section for a more detailed explanation on this. basically it's based upon your quality score, which is a combination of different criteria that google uses in order to determine how relevant your ads/keywords/landing pages are to the user's search.
Short answer: ads are ranked based on formula QS x bid. There may be a bit more to it but this is the basic formula that Google and others have made public. Longer answer: read Adwords FAQ.
From my standpoint, I believe that ads that rank higher are simply those that pay more to get listed on top of all others. Money is not longer sticking to their own principles but to money, as simple as that.
Ad Rank = (Quality Score) X (Your Max Bid) so you can increase your ad rank by either improving your quality score or by raising your max CPC. How to increase your quality score is again a detailed topic, you can google for it.