What does “throw in the towel” mean?

to admit that you have been defeated and stop trying

How is “throw in the towel” used?

In Front of the Class (2008), one line is: “Why don't you just throw in the towel and come home, huh?”

The clip at the top of this page is from Front of the Class (2008).

Why don't you just throw in the towel and come home, huh?

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