>> As clipka mentioned, a transistor used in digital circuits is either in
>> a state where the current flow is zero ("off") OR the voltage drop is
>> zero ("on"), so heat output is usually zero. It's switching between
>> those two states, when both voltage and current are non-zero, that
>> significant heat is dissipated within the transistor.
>
> Um... no?

It was a while ago I did my electronics course, but I was under the 
impression a FET worked a bit like a voltage controlled resistor. So 
with zero volts on the gate the resistance between drain and source was 
effectively infinite (so no current would flow), and as you increase the 
gate voltage the resistance went down to almost zero at a high enough 
gate voltage (so there would be current flowing, determined by whatever 
the output was connected to, but the voltage drop across the transistor 
would be near-zero).

For digital circuits you switch between fully on and fully off, whereas 
in an analog design (eg audio amplifier) you work in the "inbetween" 
region, controlling the output current based on the gate voltage. In 
this inbetween region, you have a non-zero voltage drop, and a non-zero 
current flow, so this generates heat inside the device according to P=VI.

Feel free to correct me where my understanding :-)

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