Whats all this about 20- and 24-bit digital audio? Aren CDs limited to 16 bits?
Yes, CDs are limited to 16 bits, but we can use >16-bit systems to produce 16-bit CDs with higher quality than we could otherwise. We are able to record audio with effective 20-bit resolution nowadays. The finest A/D converter systems have THD+N values around -118 dB with linearity extending far below even that. When it comes time to reduce our word-length to 16 bits, we can use any one of a variety of noise shaping curves. The job of which is to mix with our 24-bit audio, shift the dither spectrum of the noise into areas where our ears are less sensitive, thus enabling the noise component to comprise audio information at the spectral areas where our ears are most sensitive. See Lipschitz’s seminal papers for fuller detail on this subject. Furthermore, we often perform DSP calculations on our audio, and to that end it is worthwhile to carry out the arithmetic with as much precision as we can in order to avoid rounding errors.