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As the emf in an AC circuit causes current flow in the core of an inductor the magnetic dipoles will align themselves with the direction of the flow. As the current reverses the dipoles tend to stay aligned and there is a certain amount of flow that is required to realign them in the opposite direction. Thus there is a lag between current reversal and dipole realignment. The energy used for this realignment so to speak is called hysterisis and is a loss to the circuit.

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