This is a differential amplifier built using two transistors and a current source. The output is equal to the voltage difference between the two inputs. Input 1 is a 40Hz signal, and input 2 is a 40Hz signal with some small voltage spikes added in. (In this simulation, the two signals are added simply by connecting the two sources in series, which is convenient but not realistic.) The output is just the voltage spikes. The common-mode rejection ratio of this circuit is much better than the previous example; the 40Hz sine wave is not visible at all in the output.
The two inputs are connected to the bases of the two transistors. The two emitters are tied together.
In the differential-mode case, when input 1 rises and input 2 falls by the same amount, there is more base current through transistor 1, and less through transistor 2. There is also a corresponding increase in collector current. The total current through the current source does not change. The reduced current through the right transistor causes the output to rise. When input 1 falls and input 2 rises, the output falls.
In the common-mode case, when input 1 and input 2 rise together, the current source resists any change in base currents. The emitter voltages rise to match the input changes. Since transistor 2's collector current hasn't changed, the output stays the same as well. -- Credits: Mr. Paul Falstad.
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