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An NMOS transistor can reliably pull its drain terminal all the way to GND. Though we talk about the "gate voltage" (V_G) as turning the transistor ON and OFF, it's really the gate-to-source voltage that matters (V_GS). Since the source is usually grounded in a pull-down configuration, V_S = 0 V anyways, so the gate voltage is V_GS.
When we apply V_G = 5 V (and therefore V_GS = 5 V) to the left transistor, the LED turns on because the drain terminal now looks like it's connected to the source (GND). But, in the right configuration, when we apply V_G = 5 V, the transistor initially conducts because V_S (the bottom terminal) starts at GND. However, as the source voltage V_S increases from the charge flow, V_GS = V_G - V_S decreases. The gate voltage is constant, but the rising source voltage fights this and shuts the transistor off when V_GS = V_T, the threashold voltage.
This example illustrates why we typically use NMOS transistors to pull down to ground (sink current) - so that the source stays constant at 0 V leaving V_G to solely determine the transistor's state. A similar effect occurs in reverse for a PMOS, so we typicallyt use then for pulling up to VDD (sourcing current).
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