Stranded and solid wires are the two most common wire types, used in home appliances, speaker wire and AC wires running throughout your home. Solid wire is less flexible than stranded per gauge and holds its shape better. The differences between the two dictate when, where, and why one type is selected over the other.
Solid core wire is composed of copper crystals, arranged and aligned in tightly packed sequences to form the solid wire. Audio applications and others seeking low resistance look for solid core wires that have longer, fewer copper crystals. Stranded wire has individual conductors formed in the same manner as solid core, although the overall wire comprises a higher quantity of smaller strands.
Solid core wires are found in higher-voltage AC applications, while stranded is often found in lower-frequency AC uses. This is why you will find solid core running through your walls, while the lamp or appliance plugged into the outlet normally has stranded leading to it.
AC vs DC
Direct current applications typically have stranded wires as their main interconnection type. This is preferable given the low voltage, yet high-amperage scenarios found in many DC applications. Additionally, the added flexibility found in stranded wires means that vehicles will have stranded, while homes, with their high voltage and low-amperage scenarios have solid wire.
Skin Effect: the Key
Skin effect is the key determinant between the two wire types. Current typically flows toward the surface of the wire, not the core. This effect is most noticeable on high voltage alternating current than it is on direct current, or low frequency AC, such as low-voltage landscape lighting. Since skin effect is less of a factor in vehicular 12-volt applications, stranded wire is chosen for flexibility over voltage carrying requirements.