We theoretically compare the performance of optical discrete multi-tone (DMT) and pulse amplitude modulation (PAM) using intensity modulated and direct detection. PAM is a lower cost, lower complexity solution than DMT, however, it is more vulnerable to chromatic dispersion on the C-band. We compare DMT and PAM taking into consideration the interplay of laser linewidth, fiber length, transmission rate, and channel bandwidth. We use a semi-analytical model to examine bit error rates. We study how system parameters shift the performance advantages between DMT and PAM. Our model can also be used to find the best hardware solution and frequency band for a target modulation format and bit error rate.