Final answer:
The REPLACE function is used to substitute a set of characters with another in a character string, typically involving three arguments for the original string, the substring to replace, and the replacement substring.
Step-by-step explanation:
The REPLACE function is used to replace a specific set of characters found within a character string with another set of characters. This function typically requires three arguments: the original string, the substring to be replaced, and the replacement substring. For example, in many programming languages, you might use REPLACE('original text', 'original', 'new') to change the word 'original' to 'new' within the given string, resulting in 'new text'.