Q:

What is packet drop, packet loss and how Packet drop attack works?

I confused with the three terms:

Packet drop.
Packet loss.
Packet drop attack.

A:

These terms are a bit more general that that, which may be the cause of the confusion.
When Alice sends Bob a message over a packet switched network, like the Internet, then it is broken into a number of individual packets, which are sent one at a time. Each packet travels from router to router, eventually ending up at Bob's computer, where the message is reassembled.
If one of the packets fails to get from Alice to Bob for some reason, we say it is lost. (One of the reasons why you use packet switching is that if you lose a packet, you can just ask for it again, rather than needing the whole message to be retransmitted.)
It might get lost by accident, but packets can also be lost because a router receives it and specifically decides not to pass it on to the next hop. This deliberate loss of a packet is called dropping. (There are legitimate reasons for dropping a packet: for example if the router is overloaded, or if the router believes the packet is part of a DOS attack.)
A packet-drop-attack, then, is a denial of service attack where the attacker takes control of one of the routers between Alice and Bob and tells it to deliberately drop some or all of the packets in the message.

