Explanation: Aircraft Mode C transponders use Pulse Position Modulation (PPM) to transmit altitude information to ground stations. In PPM, the information (altitude data, encoded as a series of bits) is conveyed by the precise timing or relative positions of the transmitted radio pulses within a defined frame. The Air Traffic Control RADAR Beacon System (ATCRBS) interrogates the transponder, which then replies with these carefully timed pulses to encode the altitude. Differential Phase Shift Keying (DPSK) is a phase modulation technique where data is encoded in the phase difference between consecutive signals, which is not how Mode C encodes altitude. The Doppler effect relates to frequency shifts due to motion, not an encoding method for transponder replies, and "compressional encryption" is not a relevant concept. Amplitude Modulation (AM) varies the signal's strength to convey information, whereas Mode C encodes data in the *timing* of the pulses themselves, not their amplitude.