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I know this seems like a trivial question and I have seen various explanations provided on the web, but they mostly seem pretty vague, so I would appreciate if someone could clear a couple of things for me:

  1. Each farm always has a single SharePoint configuration database, correct? In other words, as soon as you have multiple config databases, you have multiple farms?
  2. Is it correct to say that a single farm can comprise multiple Windows Servers (i.e. you install SP to multiple Windows Servers), but in the background they will all "point" to the same configuration database (meaning the same SQL Server instance is used to store configuration)?
  3. If I understand correctly, a single farm can comprise several Windows Server machines and several SQL Server machines as well - but this being a single farm, only one of the SQL Server instances will store the configuration database, while others can only store content databases?
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You are correct!

http://office.microsoft.com/en-001/windows-sharepoint-services-it/managing-the-configuration-database-HA001160814.aspx

The farm can contain several servers, applications and so on.. But it's all defined in THE configuration database.

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As Burrhus said farm is a collection of servers, e.g. Web, Applicatoin or DataBase servers.

Companies do build different SharePoint farms in scenarios like when there data centers are based in different locations e.g. different countries or even contents.

Understanding the Reasons for Deploying Multiple Farms

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