The circuit consists of an audio amplifier(Q1) which increases the small electrical signal of the michrophone. The second transistor circuit is an RF Oscillator that produces the carrier signal that is transmitted. The amplified audio is used to modulate(modify)the frequency of the carrier.
The electrical signal is transmitted in the form of electromagnetic radiation to the receiver where it is demodulated recovering the audio. The audio is then amplified and fed to a speaker.
