The output voltage is controlled using a feedback loop, which requires some type of compensation to assure loop stability. Most linear regulators have built-in compensation, and are completely stable without external components. Some regulators (like Low-Dropout types), do require some external capacitance connected from the output lead to ground to assure regulator stability.
The linear regulator is the basic building block of nearly every power supply used in electronics. The IC linear regulator is so easy to use that it is virtually foolproof, and so inexpensive that it is usually one of the cheapest components in an electronic assembly.
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