FM Transmitter and transmission
Use 1kHz for the input sinwave.... Probably about 50mV peak to peak. It depends on the electret mic so you should check what the mic tells you in the specification.

BB109 is a varicap diode. It is reversed bias normally in operation. The more reverse bias you provide the lower the capacitance it gives across its terminals. The oscillation frequency is mainly governed by L1, C9, C4 and the BB109 - they form a "tuned circuit".

VR1 can set the bias on the BB109 and hence it can tune the nominal centre frequency of oscillation.

The microphone input produces a small voltage that superimposes itself on the BB109 bias - this therefore modulates the BB109 capacitance and therefore the frequency of the oscillator is modulated hence FM.