Quantization is process of approximations or rounding off. The sampled signal in PCM transmitted is applied to the quantize block.

Quantizer converts the sampled sig into an approximate quantized signal which consists of only a finite number of predefined voltage levels

Each sampled value at the i/p of Quantize is approximated or rounded off to the nearest standard predefined voltage level.

These standard levels are known as “Quantization levels “

The Quantization process takes place :

The i/p signal x(t) is assumed to have a peak to peak swing of $V_L$ to $V_H$ volts. This entire voltage range has been divided into ‘Q’ equal intervals each of size “s”.

“s” is called as step size and its value is : -

$S=\frac{V_H-V_L}{Q} ,Q=8$

At the centre of these ranges, the quantization levels, $q_0,q_1,q_2……q_7$ are placed. Thus the no. of Quantization levels is Q =8. The Quantization levels are also called as decision thresholds.

Similarly for all values of x(t) in range $Δ_1$, the quantizer o/p is constant equal to “q_1”

Thus in each range from $Δ_0$ to $Δ_7$ , the signal x(t) is rounded off to the nearest Quantization level and the Quantized sig is produced.

The Quantized signal Xq(t) is thus an approximation of x(t). The difference between them is called Quantization error or Quantization noise.

This error should be as small as possible.

To minimize the Quantization error we need to reduce the step size “s” by increasing the number of Quantization levels Q.