Hi J,
When you create an application you are automatically in the free tier. You can switch to the paid tier by adding credit card information and choosing a maximum budget per day. In the free tier you can't exceed quota limits, so if you app hits those limits it will no longer be able to use that resource until the following day when the limits are reset. For many of these limits it means your app will likely stop running (for instance, if you run out of Frontend Instance Hours you can no longer serve traffic through your Frontends). Once you are in the paid tier you'll use free quota each day until it is used up and then pay for what you use with a minimum payment of $2.10/week.
You can handle traffic spikes in the free tier but it will consume more resources. So, for instance, you get 28 Frontend Instance Hours for free each day. If you are serving traffic from a single instance all day until 1PM and then have a traffic spike from 1 - 2 which consumes 10 instance hours, you'll have used 23 of the 28 instance hours for that day and so will only be able to use 5 more instance hours for the rest of the day. So, while there is scalability in the free tier there is not infinite scalability as you are limited by the number of instance hours.
I hope that helps, feel free to ask if you have any additional questions!