In general it’s probably like this : a sensor receives a signal. For example a microphone. It catches some sound, which it transforms into electric energy. That electricity gets sent to a processor which translates it from an analog into a digital signal. So if you imagine a a reading of the sound over time, its curve would now be chopped up into values per milisecond (depending on the rate the processor can read at). These digital signals can then be used in a computer. You can display them in a spreadsheet, have a program execute an alarm, etc.
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