*Question E7E01:
Which of the following can be used to generate FM phone signals?*  

*Correct Answer is  B: Reactance modulation of a local oscillator*  

### AI Response: (may contain errors)  

To generate FM (Frequency Modulation) phone signals, the correct method is:

**Correct Answer: B: Reactance modulation of a local oscillator**

### Explanation of the Correct Answer:
- **Reactance Modulation of a Local Oscillator**: This method involves varying the reactance (inductive or capacitive) in the circuit of a local oscillator. By changing the reactance, the frequency of the oscillator changes, which effectively modulates the frequency of the output signal. This is a common technique used in FM transmitters to create FM signals.

### Why the Other Choices are Incorrect:
- **A: Balanced modulation of the audio amplifier**: 
  - Balanced modulation is typically used for AM (Amplitude Modulation) signals, not FM. It does not change the frequency of the carrier signal, which is essential for FM.

- **C: Reactance modulation of the final amplifier**: 
  - While reactance modulation can be used in amplifiers, it is not effective for generating FM signals. The final amplifier's role is to amplify the signal, not to modulate the frequency.

- **D: Balanced modulation of a local oscillator**: 
  - Similar to choice A, balanced modulation does not involve frequency changes. It is not suitable for generating FM signals, as it primarily affects amplitude rather than frequency.

### Summary:
- FM signals are generated by changing the frequency of the carrier wave, which is effectively done through reactance modulation of a local oscillator. The other options either pertain to AM techniques or do not appropriately modulate frequency. 

This understanding is crucial for the Extra Class exam, as it highlights the differences between modulation techniques and their applications.