Our good friends at Sayal Hobbies still have a few of theses pretty nice little AM transmitter kits that might be the ultimate low cost entry level transmitter kit. The AM Microphone Broadcast Station Kit - C6752is a small but efficient, experimental AM broadcast station using a high-gain electret microphone, two transistors and a RCA jack so that you can also connect to the earphone output of your MP3 or CD player.
The reviewer over at the Christian Radio Project says..." it is very impressive for its cost and simplicity of construction and may potentially be a good candidate for use in a low-cost neighborhood AM station. It truly has all the makings of an effective and yet very simple transmitter..."
This review goes on to note that the tuning capacitor that comes with the kit can make adjusting the frequency frustrating but after all, this is a fully functioning transmitter for under $10.00
An easy way to cope with the supplied tuning capacitor is to use a long, non-conductive tuning stick (rod with a chisel tip at one end that will fit in the tuning slot of the capacitor) made of plastic, wood or similar material. The tuning stick should be long to keep your hand from getting too close and detuning the circuit.
This is a very basic kit and includes everything you need, clear instructions, a minimum of parts and simple assembly requirements.
MODS - If you would like to get a better variable capacitor, you will need to replace the 3.5 - 13 pf trimmer that comes in the kit with a better unit from a supplier like Dan's Small Parts and Kits or your local source. Connecting to a real RF ground, probably best to connect to the negative battery terminal,will always boost range. A 12-18 volt power supply could be used in place of the battery. Adjusting (by sliding the iron powder rod in and out of the wire-wrapped cardboard sleeve) the loading coil connected to the antenna would also kick out the range a bit. Soldering, kit building, an AM transmitter and lots of hacking fun await!