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A proxy server is an interface between your browser and the destination server. The proxy server takes your page request and handles the connection to the destination for your browser. Proxy servers are also able to cache pages. If a proxy is configured to cache, it first looks for the requested page in its local cache. If the page is not cached, the proxy server either searches in other caching proxy servers ,or sends the request to the destination. This depends on the configuration for the proxy.
The increase of efficiency gained by using a common caching proxy server depends on the probability of finding a page in the local cache. This probability is generally expressed by the hit rate. A cache with several GB of Web page storage and many users can reach a hit rate of 30 to 40 percent. Frequently requested pages, like the help pages of your browser, will almost always be in the cache.