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They are used where variable voltage or variable resistance is required. For example, it is used in light dimmers to control light brightness. It is used in audio amplifiers to control sound level. It is used in various circuits where the potentiometer resistance is varied to set a reference voltage. They may be used to adjust the output voltage of a power supply.
The peculiar name for a resistor with a movable contact on it stems from its invention. in years gone by the only stable voltage source was a weston standard cell. This had a very stable voltage but a high internal impedance. So the actual voltage available depended on the amount of current you took out of it. So the experimenters strung a piece of resistance wire across the battery under test with a variable tap on it. The Weston cell was then connected via a centre zero galvanometer (sensitive current meter) and the tapping point adjusted to get no current on the galvanometer. The relative voltage on the battery under test could then be calculated by measuring the length of resistance wire each side of the tapping point and mutiplying by the known voltage of the standard cell. hence POTENT (ial divider) - ometer.
Frank
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