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Transistors are little electronic switches. There are quite a few different types of transistor available, and each have their own characteristics, advantages and disadvantages. They can be used to switch and amplify low-level signals, but can also function well as standalone electronic switches for devices such as motors, LED's or solenoids. Other specialist transistors, such as phototrransistors, respond to the amount of light shining on it in order to produce a current flow.
This is a current controlled Bipolar Junction Transistor (BJT), which is made up of 3 regions: the base, the collector, and the emitter. A small current entering in the base region of the transistor causes a much larger current to flow from the emitter to the collector region. BJT's have the lowest impedance of all transistors, and therefore allow current to flow through the base of the transistor, which results in high amplification.
This is a P2N2222AG NPN Bipolar Transistor, designed for use in linear and switching applications, and is housed in the neat TO-92 package. The P2N2222 is a "bread and butter" class NPN transistor suitable for the majority of low current electronic switching applications. They can switch up to 40V @ 600mA continuous, or 1A peak with a DC gain of 100.