There have been several posts on the Elecraft reflector about AGC settings and a noisy K3. These subjects are related, and the effect will vary depending on the amount of noise you have at your location on a particular band and with a particular antenna.
If your S-meter shows an S-0 or S-1 level on the ambient noise conditions, the default AGC settings are likely to work just fine for you. Congratulate yourself on a rather noise-free location and go on with your operation.
However, if your noise level is bothersome between breaks while listening to an on-the-air conversation (either CW or SSB), you can do something about it using the highly configurable K3 AGC settings.
The major controls for changing the AGC characteristics are the CONFIG menu settings for AGC THR and AGC SLP.
The range of adjustment for the K3 AGC threshold was increased in MCU firmware release 4.51. You should upgrade tothe latest firmware if you have not already done so. The 4.51 firmware release note is copied below.
MCU 4.51 / DSP 2.76, 5-9-2012
* AGC IMPROVEMENTS: AGC threshold (CONFIG:AGC THR) can now be set much higher, and the AGC has better (more monotonic) response curves. Greatly improves signal clarity in pile-ups and other high-noise or dense-signal situations, especially with threshold set to 12 or higher. NR and autoNotch can be used at all threshold settings.
The AGC Threshold setting determines how weak the "signal" can be that begins to activate the AGC. It can be set so low that even the band noise will activate the AGC. Look at your S-meter while there are no signals on the band. If the S-meter is indicating anything at all, then the AGC is being activated by the band noise. If the indication is only S-1 and perhaps an occasional blink of the S-2 bar, that is usually a tolerable situation, but if you have an S-5 noise level at your location with your particular antenna and on a particular band, you will want to change the AGC Threshold.
A higher AGC THR setting will raise the level where the K3 AGC response begins, so try higher settings to see what the effect is for your situation.
A caution about evaluation of the effects of the change - please listen to the noise level that appears during breaks while listening to a signal. If you listen to only the noise level with no signals present, you will find that the noise level decreases as you lower the threshold setting. This is a false perception. What is actually happening is that you are reducing the level where the AGC response begins, and since the noise is now producing AGC action, the noise will reduce the gain of the receiver, giving the appearance that the noise level is being reduced, when in fact, just the opposite will happen when listening in the presence of signals on the band.
The slope of the AGC characteristic determines how much difference in audio there will be between a weak signal and a strong signal. At high setting of AGC SLP, all signals will be close to the same audio volume. While that is good for some ragchew situations, consider that the AGC detection circuits cannot discriminate between a real signal and the broadband "signal" that is actually atmospheric noise. If you use a high slope setting for the AGC, the noise will also be at a high audio level.
Reducing the AGC SLP setting will cause weaker signals to have less audio than a stronger signal, and as long as the signals of interest are above the level of the band noise, the signals will have more audio volume than the noise. Conversely, if you use a high slope setting and the band noise is almost as high as the desired signal, the noise will appear almost as loud as the desired signal in the speaker or headphones.
The K3 is quite a sensitive receiver, and has a wide dynamic range. That means it can hear weak signals (sensitivity) and at the same time, can tolerate quite large signals without overloading or producing significant distortion products (dynamic range). The typical K3 can "hear" signals as low as -140 dBm (specification is -136 dBm) and can faithfully reporduce signals up to the vicinity of 0 dBm. So if your local noise is at -110 dBm, it will waste 26 to 30 dB of the available K3 dynamic range. To get some of that dynamic range back, turn the preamplifier off, and if necessary, turn the Attenuator on - if the band noise is that high, you do not need the extra gain because you are not likely to copy signals that are weaker than the band noise, and the band noise is just reducing the K3 dynamic range possible. OK, some operators and weak signal modes can copy signals well below the noise, but that is an exception, those operators already know how to optimize their reception.
If the band is relatively quiet of atmospheric noise, the default settings will usually suffice and work quite well. But all bands and all locations are not the same. Work with the band and antenna you use which produces the greatest atmospheric noise level at your location.
You might want to start with the settings that I use, and that is with the Threshold set at 012 and the Slope set at 012, but if you want to start with some other settings, that is entirely up to you and your conditions.
Listen to actual signals while making the changes, as I indicated, listening only to the noise level will give you the impression that you are making improvements (the noise level will go down with lower threshold settings if you are trying to use only band noise) when in reality, it is only making the situation worse. Explanation - if you are listening only to the noise level, as the threshold is lowered the AGC will begin to reduce the reciever gain, and the noise level will decrease. Do not be mislead by this "apparent" reduction in noise, it is actually reducing the receiver gain due to the lowered threshold in conjunction with the noise level and in operation will make the K3 seem even more "noisy".
Evaluate the noise level relative to the desired signal level during breaks in the signal (CW = between words or between transmissions: SSB = between breaks in the conversation or between transmissions). You are stiving to get a larger difference in the audio between the times when the signal is present and when it is absent. The Threshold and the slope will interact to some degree while making this assessment. If you have the slope set to a high value, all signals will try to have the same AF amplitude, and if the Threshold is set too low, the AGC will be triggered on the band noise as well as on the signal. The combination of a low threshold and a high slope will cause everything to try to be at the same audio volume - and that includes the noise (noise is just another broadband "signal" to the AGC circuits). So, with a low threshold, the K3 AGC looks at the low level band noise and thinks it is just another signal and then dutifully amplifies it - that is NOT what you want to achieve.
Increase the AGC Threshold to the point where the AGC is only minimally activated on the band noise for your most noisy band. Beyond that, adjust the slope to whatever you wish - if you are a roundtable ragchewer type, you will prefer a higher setting for the AGC SLP so it will make the weaker stations sound almost as loud as the stronger stations. But, if you are more into minimizing the noise during breaks in the conversation, you will opt for a lower SLP setting. Contesters who want to evaluate the relative signal strength by ear rather than relying on the S-meter reading will tend to use lower slope settings than the average. My personal settings are for THR = 008 and SLP = 002. That gives me an AGC response that is close to that produced by the K2 which I came to appreciate and like after 10 years of K2 experiance before I got my K3.
The first order of attack to a K3 that is perceived as "noisy" is to reduce the front end gain. That means turnig off the preamp and may even mean turining on the attenuator when the band noise level is high. Doing so will increase the dynamic range of the K3 (or any reciever). The noise levels will be reduced by those simple steps. The K3 does remember those setting on a per band basis, so once you have set a particular band for the Pre/Att that is best for that band, it will be remembered when you return to that band.
The AGC settings are universal (not on a per band basis), so you must reach a tolerable compromise for the bands that you normallly operate. If your operation is on the upper HF bands and VHF/UHF transverter bands, your AGC settings will be different than those operators who regularly use 80 meters or 160 meters. There is no "one universal setting" that can optimize every situation. As difficult as it is to determine the AGC settings that apply to your operating methods and choice of bands, I believe we can be thankful that the K3 provides a range of AGC responses that can optimize the receive AGC characteristics to match a wide range of band noise and operating preferences. Yes, it does take some time and effort to determine what is best for our particular operating situation, but the reward is a K3 that is optimized for our particular operating situation.