The two terms are used frequently in data communication are bit rate and the baud rate. Bit rate can be defined as the number of bits transmitted during 1s. Baud rate can be referred as to the number of the signal units per second that are required to represent those bits. A signal unit is composed of one or more bits. In discussions of the computer efficiency, the bit rate is the important; we want to know how long it takes to process each and every piece of information. In data transmission, however, we more concerned with how efficiently we can move those data from one place to another, either in pieces or blocks.

The fewer signals units required, the more efficient the system and less bandwidth required to transmit more bits; so we are more concerned with baud rate. The baud rate determines the bandwidth requires sending the signal. Bit rate equals the baud rate times; number of bits represented by each signal unit. Baud rate equals the bit rate divided by number of bits represented by each signal unit. The bit rate is always greater than or in some cases equal to the baud rate. So we can say that the bit rate is the number of bits per second while Baud rate is number of signal units per second.

The fewer signals units required, the more efficient the system and less bandwidth required to transmit more bits; so we are more concerned with baud rate. The baud rate determines the bandwidth requires sending the signal. Bit rate equals the baud rate times; number of bits represented by each signal unit. Baud rate equals the bit rate divided by number of bits represented by each signal unit. The bit rate is always greater than or in some cases equal to the baud rate. So we can say that the bit rate is the number of bits per second while Baud rate is number of signal units per second.