Both AM and FM radio signal carriers are output at a single frequency (FM is usually much higher than AM). AM (amplitude modulation) carriers alter in amplitude to mimic the audio being sent. The carrier signal frequency doesn't alter. FM (frequency modulation) carriers alter in frequency to mimic the audio being sent. The carrier signal amplitude doesn't alter. Receivers of either type are designed to detect those changes which are applied to the carrier signal to retrieve the audio signal.

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The major point of difference is with regard to how the "information" rides on the carrier wave. AM is amplitude Modulation, and FM is Frequency Modulation. With both AM and FM, a carrier wave must be broadcasted. The carrier wave is at a particular frequency, which is singled out as you tune in your radio station. All other frequencies are filtered out. 1. In AM or Amplitude Modulation, the information is added to the amplitude of the carrier signal. When the receiver receives the signal, it does an analog sample of the wave to determine its average strength, and then demodulates the differences in the amplitude to pull out the original information. This is the worst and most inaccurate way of demodulation; for the signal strength is continuously changing, with the analog demodulator always working "behind the times". This is why it took so many years for the occurrence of AM Stereo. The reason it came first is, it is very easy to mix amplitudes, and no complicated circuitry was required in the old days to pull in the correct carrier wave. They couldn't do frequency modulation at first as commercial businesses were not allowed to be transmitted on high enough frequencies to pull out the original information. Also since AM carrier waves have relatively low frequencies, they can travel quite a distance. In Frequency Modulation, the information is added to the frequency of the carrier wave. The amplitude of the incoming signal is a mute point as long as it is strong enough where the receiver can lock onto the carrier wave. Carrier frequencies in high ranges were released for commercial use, so they could transmit in the Mega Hertz range. Since all information needed in the hearing range is commonly in the 20 to 20KiloHertz range, it was easy to pull the signal in. The information didn't cause enough of a difference in the signal to cause the tuner to filter it out. And since the original carrier frequency is known, and locked in, it was extremely easy to pull out the original information. In fact, add 6 or 8 different information signals could be added. Since the demodulation is so accurate, this gives it better clarity, and the ability to modulate 2 separate signals for stereo. However, since the carrier frequency is so high, it bounces off obstacles instead of going through them, thus reducing range. 2. AM type of modulation is subject to static interference from such things as household appliances — and especially from lightening storms. AM also limits the loud-to-soft range of sounds that can be reproduced called dynamic range and the high-to-low sound frequency range called frequency response. However, FM is virtually immune to any type of external interference, it has a greater dynamic range, and it can handle sounds of higher and lower frequencies. This is why music, with its much greater frequency range than the human voice, sounds better on FM radio.

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AM radio uses amplitude modulation FM radio uses frequency modulation "AM radio uses amplitude modulation, in which the amplitude of the transmitted signal is made proportional to the sound amplitude captured (transduced) by the microphone, while the transmitted frequency remains unchanged. Transmissions are affected by static and interference because lightning and other sources of radio emissions on the same frequency add their amplitudes to the original transmitted amplitude. In the early part of the 20th century, American AM radio stations broadcast with powers as high as 500 kW, and some could be heard worldwide; these stations' transmitters were commandeered for military use by the US Government during World War II. Currently, the maximum broadcast power for a civilian AM radio station in the United States and Canada is 50 kW, and the majority of stations that emit signals this powerful were grandfathered in; these include WGN (AM), WJR, KGA at 50 kW. In 1986 KTNN received the last granted 50,000 watt license. These 50 kW stations are generally called "clear channel" stations (Not to be confused with the Clear Channel radio conglomerate), because within North America each of these stations has exclusive use of its broadcast frequency throughout part or all of the broadcast day. FM broadcast radio sends music and voice with higher fidelity than AM radio. In frequency modulation, amplitude variation at the microphone causes the transmitter frequency to fluctuate. Because the audio signal modulates the frequency and not the amplitude, an FM signal is not subject to static and interference in the same way as AM signals. Due to its need for a wider bandwidth, FM is transmitted in the Very High Frequency (VHF, 30 MHz to 300 MHz) radio spectrum. VHF radio waves act more like light, traveling in straight lines, hence the reception range is generally limited to about 50-100 miles. During unusual upper atmospheric conditions, FM signals are occasionally reflected back towards the Earth by the ionosphere, resulting in Long distance FM reception. FM receivers are subject to the capture effect, which causes the radio to only receive the strongest signal when multiple signals appear on the same frequency. FM receivers are relatively immune to lightning and spark interference. High power is useful in penetrating buildings, diffracting around hills, and refracting for some distance beyond the horizon. Consequently, 100,000 watt FM stations can regularly be heard up to 100 miles (160 km) away, and farther (e.g., 150 miles, 240 km) if there are no competing signals." Source and further information: http://en.wikipedia.org/wiki/Radio Further information: http://en.wikipedia.org/wiki/Frequency_modulation http://en.wikipedia.org/wiki/Amplitude_modulation