What is a Power Transformer?

A Power Transformer is a device that changes the voltage of an electric current. A transformer takes in electricity at a higher voltage and lets it run through lots of coils wound around an iron core. Because the current is alternating, the magnetism in the core is also alternating. Also around the core is an output wire with fewer coils. The magnetism changing back and forth makes a current in the wire. Having fewer coils means less voltage. So the voltage is "stepped-down." This same process can be used to "step-up" a voltage, although stepping-up a voltage is a lot less common.

What are some uses of power transformers in our society?

Step up transformers are used for welding purposes and for carrying electrical current over long distances (Example - Electricity poles and towers).
Step up transformers are used for the production of x - rays in hospitals.
Transformers are used in high - voltage regulators and in stabalized power supplies.
Small scale transformers are often used in radios, television sets, telephones and other common househole electrical appliances.

How are power transformers constructed?

A regular soft iron core is made up of many seperate plys of sheet metal. Each sheet of metal is very high quality and well insulated from the next. These sheets are bolted together to form a large square shape. Two coils of wire, one thick and one thin (depending on whether the transformer is a step up or a step down), are wrapped tightly around either side of the transformer. Also, as with the sheet metal plys, the couls are well insulated from each other. The primary coils (P1 and P2) are wrapped loosely with a thick wire if a step up transformer is being built, and are wrapped tightly with a thin wire if a step down transformer is being built. The primary coils will supply the main power source for the transformer with the use of an AC source. The secondary coils (S1 and S2) are wrapped tightly with a thin wire if a step up transformer is being built, and are wrapped loosely with a thick wire if a step down transformer is being built. The secondary coils will null the current with the use of a load resistance.

So where does magnetism fit into all this?

As the current in the primary coils vary, the magnetic flux linked with the primary coils (P1 and P2) varies and an EMF (Electromagnetic Field) is produced due to self induction. Due to mutual induction, an EMF isn't used in the secondary coil.

Some clarification - Self induction is the generation by a changing current of an electromotive force in the same circuit. Mutual induction is the production of an electromotive force in a circuit by a current change in a second circuit magnetically linked to the first.

http://www.tutorvista.com/content/physics/physics-iv/alternating-currents/transformer-animation.php

A simple diagram of a step down transformer. (If you use the 1st right hand rule, you can see which way the current travels :D)
Step-down transformer diagram
Step-down transformer diagram
http://www.powertransformer.us/primaryvoltage.htm