What are the applications of twisted pair wire?
One application is when signal isolation is required. Twisted pair wire tends to self-shield for differential signals. This is because external interference induces equal currents in both conductors due to the symmetry of the twists. The differential input then cancels out the common-mode (equal on both wires) noise, allowing the desired differential signal to pass. One interesting example of this is UTP (CAT5, CAT6, etc.) cable used for ethernet cabling. If you strip the jacket off of a length of cable, you will notice (obviously) that the pairs are twisted. Look closely though, and you will notice that each pair is twisted with a different twist-per-inch than the other. If each pair had exactly the same twist, then the pairs cold 'line up' with each other, allowing crosstalk between the pairs (very bad). By varying the twist rate, crosstalk is minimized. In fact, the different twists are prime numbers, which means they never match up anywhere in the cable! Is that cool or what!