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How to fix peaking audio in audacity

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What causes clipping? Is there anything we can do about it? Is it the same as peaking (yes)? I'm going to explain it all, tell you what it sounds like, and show you how to fix it. Whether during recording or playback, you've been around someone that sees the little red light go off or light up permanently who then says 'Oh, dude, you're clipping.' But do they even know what audio clipping is?