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Modulation index(m) is given by the formula (|x(t)max|)/v, where x(t) is the modulating signal and v is the maximum carrier voltage.

so m will be greater then 1 if x(t) is greater then v. This results in overlapping of upper and lower wave in the output signal which is called diagonal clipping and this information is lost and thus greater value of m is undesirable.

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Q: Why large value of modulation index is undesirable?
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