I'm really confused with the terms database, user and schema. Can anyone explain how they are different from each other (if they are)?
If they are same then, what are the similarities between them? How do we use them? And how do we create them?
In Oracle, users and schemas are essentially the same thing. You can consider that a user is the account you use to connect to a database, and a schema is the set of objects (tables, views, etc.) that belong to that account.
See this post on Stack Overflow: difference between a User and a Schema in Oracle? for more details and extra links.
You create users with the
The database is the thing contains all the users you've created, and their data (and a bunch of predefined system users, tables, views, etc. that make the whole thing work). You should look at the Oracle Database Architecture documentation in the Concepts Guide (actually, that whole page is worth a read - there's a section about users and schemas higher up in that page) to get an introduction to what a database is, and what a database instance is - two important concepts.