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What is an Isolation Transformer?

Practically all transformers (with the exception of Autotransformers) are, in fact, Isolation Transformer.  This is due to the fact that their primary and secondary windings are PHYSICALLY isolated from each other (they are not physically connected to each other).  The transformation in voltage and current between primary and secondary windings occurs as a result of the shared magnetic field in the core (Mutual Inductance).