What does a displacement switch indicate regarding counterweights?

A displacement switch is designed to monitor the position of counterweights in a lift system. When it indicates that the counterweights have left the rails, it implies that the counterweights are no longer within their designated path or range of motion, which could potentially create safety hazards or operational issues. This signal is crucial, as it can alert operators to a malfunction that may require immediate attention, preventing further complications related to derailment or system failure.

In contrast, the other choices represent different states of the counterweights or conditions that do not directly relate to the function of a displacement switch. For instance, while balancing or alignment are important aspects of counterweight operation, they do not specifically trigger a displacement switch. Additionally, a displacement switch does not indicate overloading, as this condition would typically be monitored through different sensors or systems focused on weight detection or load limits. Thus, the correct answer accurately reflects the function of the displacement switch in monitoring the specific condition of the counterweights in relation to their operational boundaries.