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An ad's Quality Score on the Google Display Network will affect:
A) the Quality Scores for the keywords in that ad group
B) the Quality Score for the same ad on Google and the Google Search Network
C) The Display Network partners on which the ad is eligble to show
D) whether an ad is eligible to enter the ad auction
Explanation:
AdWords uses an ad auction to determine which ads to show, the order those ads will appear, and how much those ads will cost. The Display Network ad auction shares many similarities with the AdWords auction. Your ads are ranked among other advertisers' ads based on Ad Rank, which is based on your Max CPC bid and Quality Score. This means that, if your Quality Score is sufficiently better than the score of the advertiser immediately below you, you could rank higher than that advertiser, even if this person's bid is higher than yours.
Read more here: https://support.google.com/adwords/answer/2996564?hl=en&ref_topic=3119129