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The silicon microchip is another name for the integrated circuit. This is a small chip made out of a semiconductor material, usually silicon, that contains numerous (hundreds, thousands, even millions) transistors in very tightly compacted, elaborate configurations. In the old days, transistor circuits had to be made individually and connected via vacuum tubes. These vacuum tube setups were bulky, generated a lot of heat, and prone to breaking down. The silicon in a microchip essentially replaces the need for vacuum tubes, thus vastly decreasing the amount of space needed and also the cost for production. Simple integrated circuit chips are used for simple things like radios but more complex ones are used as microprocessors in computers. A microprocessor has an internal memory and can perform mathematical funtions and algorithms on data that is fed into it. That is what allows it to "think". The microprocessor doesn't really think independently, but it can be programmed to quickly process a huge amount of information according to highly complex programming that is encoded into the integrated circuit.
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