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Originally Posted by
nyf 
There's an assumption here that pushing MP3 bitrates past 192 results in a proportional increase in audio quality all the way to 320 kbps. That's not necessarily true. Compressions tend to be less effective at the extreme ends of the spectrum. In the case of MP3, higher bitrates result in increased sampling over much of the frequency spectrum, but you will always have high frequencies chopped off in a particular way (I believe ~15.5kHz is the cutoff) regardless of bitrate because they are assumed to be outside of normal human hearing.
The lowpass for LAME's V2 setting is 19khz, so you probably have to have bat ears to hear any quality issues caused by this. You're right that higher bitrates don't mean higher quality though, because transparency is usually reached at bitrates well below even the 200kbps range.
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I would say that my hearing is pretty good, I'm a hobbyist musician with some training, and I have no doubt that I can hear audible distinctions between high-quality MP3s and CDs. You do not need a $20,000 system, just something with reasonable amplification and a decent sized room. You may be able to hear a difference in spatial localization (which is compressed in MP3), smearing in percussive sounds (due to the undersampling), or changes in the nature of a sound due to frequency cutoff (like harmonics on a piano).
Well, for most music, it's pretty much impossible to hear a difference no matter how good the equipment is. But there's still some very rare problem sounds that won't ever be totally transparent due to limitations of the mp3 format, like castanets, which cause pre-echo even on high bitrates. The AAC format has gone a long way of removing such limitations though.