Whenever a current flows in a wire it creates a magnetic field around it.
this magnetic field can be used to magnetise an iron core - which will remain a magnet for as long as the current is flowing in the circuit.This gives us a magnet we can switch on and off,called an electro magnet.
The nail acts as an iron core inside the coil of wire - this makes the magnetic field stronger than if it was just the field around the wire itself.
You can also make the magnetic field stronger by having more turns on the coil or by having a larger current.
Electro magnets differ from ordinary magnets because the magnet can be turned on and off by switching the current on and off.
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