It may work in several different ways, depending on the actual circuit used. As asked no better answer can be given than the circuit board alternately turns the current in the LED on and off.
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current limiter.
A circuit board consists of numerous electronic components, depending on the application, these components can be in the thousands or in the ten's, therefore circuit boards vary in numerous sizes, all connected using very fine electrical connection strands.
Sure. If you want sound when the circuit is energized, use a buzzer. If you want a visual indication when the circuit is energized, use an LED.
light up when forward biased
Most Likely LED's! Not Sure Though! Better Check With Someone Else!