How SEO affect Adsense And Vice Versa (How It Affect Your Earnings)

Many of my students ask me that 
Does using Google AdSense increase the SEO rankings?

The answer i used to give them was 'YES', but today i thought to write how it affect one another in a understandable way.
Interrelated
Before understanding that lets recall some term

What is Google Adsense ?

Google Adsense is a program by Google where Publishers can sign-up and if approved can place ads on their website/blog and can earn some $ if someone clicks on those ads which differs everytime based on location and various factors.

What is SEO ?

SEO stands for search engine optimization which has nothing to do with Google Adsense in any way. For more you can read my answer on SEO.

However you would be earning more with Google Adsense if your website SEO is good. Let us understand how?

Get back to topic,

Yes it does affect each other, you would be earning more with Google Adsense if your website SEO is good. Let us understand how?

Better SEO = Better Rankings

Better Rankings = More Organic Traffic

More Traffic = More Clicks on Ads placed on website

More clicks on ads = More $$$ rolling in to your Google Adsense Account

 

Also better the traffic of you blog, it becomes a good place to advertise and more demand leads to more price. Advertisers would be paying more CPC to place adds on your site, So you can make more money.

And if more people click on your adds then it will help crawlers to index the page and result in better SEO

Also See : How to Use Permalinks For Seo

Its is interrelated and jointly Affect your Earnings

Hope you understand what i mean to explain, by understanding this you will be able to take your blog or websites to next level, Good Luck!