A wireless access point is the device that actually handles broadcasting and receiving WiFi signals to and from devices. Most people’s homes are serviced by one access point, the one inside their router or the gateway the ISP is renting them.
The function of WiFi can and probably should be it’s own thing, separate from the router. Businesses have done it this way for close to two decades now because it’s the only way to get the coverage, performance, and scalability they needed.
You can add as many wireless Access points as you want to a network, and the more you have (and powered and tuned correctly) the better your wireless network performance will be. Adding access points (APs) is pretty much the only way to add more capacity to your network. Even high density access points are still limited by the connection they are plugged into. All wireless is wired at some point.