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It is basically a passthrough board that plugs into the IEEE-488 port on the rear of the Commodore PET. The status of all of the signal lines are shown on 20 LEDs. 8 show the data lines, 8 the handshaking lines, one shows power and three are not connected.
Driver chips are used to minimise the loading on the bus signals, so this can be left in place without affecting normal operation. 5v power is connected at the side.
The diagnostic board serves multiple purposes. Firstly, it can be used to test the IEEE-488 drivers on the PET. I have a simple program which sets the signals on the port one by one, so you can watch the LEDs to check they are all coming on in series. The PET can also read back the status of these pins to test both directions.
Secondly, it can be used when testing IEEE-488 devices, as you can monitor the status of the lines. Thirdly, it serves as a port saver / extender, so saves wear on the edge connector.
Finally, in conjunction with special firmware on the PET microSD, I can test the IEEE-488 drivers on there, again by cycling through the outputs.