Analog signals, including alternating current, are exemplified by sine waves, which are continuous in nature. The discussion clarifies that while a sine wave is an analog signal, it can also be represented digitally, but the distinction between analog and digital signals requires more context. The confusion around the definitions of analog and digital signals is addressed, emphasizing that a simple sine wave does not inherently specify the type of signal. A digital representation of a sine wave, such as that from a Digital to Analog Converter (DAC), differs in form from its analog counterpart. Overall, the conversation reinforces the understanding that sine waves can be both analog and digital, depending on their representation.