An Instance is nothing but a CRM database stored in SQL database. A tenant is nothing but an office 365 account. Each tenant can have up to 50 production instances and 75 non production instances. Each instance will get 5 GB of storage. With Admin access you can perform variety of actions at an instance level.

• Switch – This allows user to switch a production instance to sandbox instance or vice versa. However, you cannot switch to a production instance unless you have a extra production instance in your subscription.
• Reset – This allows you to reset your sandbox instance, which means deleting existing instance and recreating it again. This is not applicable to production instances
• Copy – You can copy an instance to another instance. There is a full copy where all your customizations, users and data are copied and minimum copy which copies customizations and users only.
• Delete – Deleting a sandbox instance. Not applicable for production instance. When you delete a sandbox instance, license gets available for reuse and storage gets available for other instance

Administration mode: A sandbox instance can be set into administration mode, when set, only system administrator or system customizer can sign into the instance. This disables all background process. This helps us to perform any maintenance activities on the instance.