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A transponder is a device on a satellite that automatically sends out signals in response to receiving a different signal. Its name is taken from the words "transmitter" and "responder," which also describes a transponder's function: to receive transmissions and respond to them with a different transmission.

What Small and Midsize Businesses Need to Know About Transponder

Transponders are used most often in aviation, allowing planes to receive signals from air traffic control and automatically reply with the plane's identification code and altitude information. Transponders also make a plane visible on radar. Transponders can also be found in cars and cell phones and are used to locate in case of emergency. Some SMBs use transponders on key cards that give employees access to certain buildings or rooms in the workplace.

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