AFAIK:
A web-server usually hosts only front-end jsps/htmls. It will have very little or no business logic.
An Application server on the other hand would host a lot more of business logic.

Depends on what kind of project is under consideration. Some combinations I have seen are:

• Web server and database server
• App server and database server
• Web server, Application server and database server

And BTW, a web server is different from a Servlet container considering that the latter is required if you want to host Servlets and JSP's. Basically its like:

Application Server <- Web Container <- Web Server

Application server incorporates everything.

AFAIK this used to be the case, now-a-days webServ itself takes care of both these tasks.

No. Tomcat is a ServletContainer that is able to perform most of the tasks of a web server.

Apache is a Web Server, but has 0 JSP/Servlet capability (it has its own ASPs, but that is something else entirely).

The above are just two examples to show the difference between a Servlet Container and a Web Server. S.O.S's order list is correct.

I didn't exactly get this. But I know that in our product, for O&M GUI we use Apache Tomcat. The GUI is written completely using JSPs.

webserver doesnt support business logic

whereas application server support business logic

and

Everything in web server must be achieved programmatically

where as in application server

it provides a lot of services like security, transaction , scalability.

> But I know that in our product, for O&M GUI we use Apache Tomcat
Apache Tomcat is a web container which knows how to handle Servlets and JSP's and has all the capabilities of a normal web server.

Apache Web Server and Apache Tomcat are two different things.

> webserver doesnt support business logic
Thats not a generic statement. It does when your server side logic is written entirely is PHP. AFAIK, there is no app server for PHP, though I admit my understanding of PHP even fails me. Also when you have a small scale project, using a web container gets the job done. Low complexity projects seldom require the power of an Application server.

Also, at least as far as apache is concerned, there is no reason why the Web Server can't have business logic. I know someone who has written an entire web site (not page) (and a complex one at that) as an Apache module. Very fast, but I, myself, would not want to be the one that had to maintain it (although there was flexible content).