A typical terrestrial repeater for amateur voice will have a receiver that demodulates a signal to audio, then its fed to a transmitter at a different frequency and sent back out. It only works in one mode which the receiver is designed for (usually FM) and the transmitter power is fixed and continuous. Its also only works at the single frequency that the receiver is tuned to.
A Linear Transponder is much different in there is no specific receiver and nothing is demodulated to audio. It will also pass a signal of any modulation as long as its narrow enough to pass through the input and output filters in the system.
In its simplest form a Linear Transponder has an input bandpass filter to limit the incoming spectrum. It could be 50KHz wide or 50MHz wide. The signal or signals within the passband are amplified and translated intact (with a mixer and local oscillator) to another frequency range then amplified and filtered again before being sent to the antenna..
Whatever signal goes in at the low end of the input passband would usually go out at the low end of the output passband but it can be inverted depending on the design. The output signal level would be proportional to the input signal level, meaning if you went in to the linear transponder with a weak signal it would come out at a weak level and a strong input signal would go out at a higher level up to the maximum power of the amplifier in the output section of the translator.
Depending on the bandwidth of the filters you could have one to many signals passing through the translator or transponder at any given time and the signals could be any mode.
Since the amplifiers in the transponder are shared, there is only so much transmit power available and a single strong signal into the transponder that causes the amplifiers to saturate will hog the entire transponder and weaker signals passing through at the same time will suffer.
A linear transponder is often referred to as a "bent pipe" taking in everything within its input range and spitting it out on its output frequency range with varying signal levels kept in proportion to each other.
prcguy