lawgator1
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No, the transponder just helps ATC identify a specific plane on their radar. Specific transponder #'s are given to specific aircraft so that the "blip" on the radar now has a name, it can also calculate altitude and speed.
Lots of private aircraft can fly without transponders and are only required to turn it on if they are required to class of airspace, are IFR, request flight following or are requesting clearance at a controlled airport.
Otherwise your plane is just a blip on the radar screen that they don't care about, or steer other aircraft around.
The plane would still show up and could be tracked by radar without a transponder but depending on how busy the airspace is it would be like watching moths circle a lightbulb and trying to remember which one is which. When theres only one and it's radar connected to the transponder - when it disappears from ATC screens... Buttholes tighten up.
Source: I fly.
Does that include commercial jets?
Per my post above I would have thought that if a commercial jet's transponder went off and the thing turned around someone might have called out to it to ask why.