PHP originally stood for Personal Home Page, but latterly it became known as PHP Hypertext Preprocessor, a recursive acronym.
PHP can also be used to serve as a method of accessing information on forms, an important part of online shopping.
PHP requires some kind of interpreter on the server or local machine. One such example is XAMPP, which also includes phpMyAdmin and MySQL.
PHP absolutely requires the .php file extension or a file extension which has the PHP MIME file type associated with it to inform the PHP server what it is looking at or that the server understands that a certain file is to be processed as PHP.
PHP also requires installation on the server, so it is not possible to just run PHP on a local machine without the proper server software such as Apache (there are complete packages that include server applications such as MAMP).