Sample resolution
specifies the accuracy of each amplitude measurement made by the ADC
hardware. The more *bits* of resolution, the greater the
accuracy. A *bit* is defined as one binary digit, that is, either
the value 0 or the value 1. Thus, when only one bit is used to represent the
value of an amplitude measurement, the amplitude must be either 0 or
1. If two bits are used to represent amplitude values, then four
possible amplitude values can be represented (0, 1, 2, and 3). More
generally, the number of amplitude values that can be reresented by a
given number of bits is 2**N where N is the number of bits. Using a
large number of bits per sample allows the full amplitude range of an
ADC to be partitioned into a large number of very small steps.

In the following figure, the X axis is time in msec and the Y axis
is amplitude in arbitrary units. This figure shows an analog sine wave (solid line)
is sampled (illustrated by the circle symbols) at a comparatively high
rate compared to its frequency and with good sample resolution.