Solving the sound problem with Pinnacle Studio 16.
This video is for others that have the same issue with Pinnacle.

The sound disappeared everywhere when using Pinnacle Studio 16 and the solution was to bring up Control : Hardware and Sound and then click on "Adjust system volume". The Pinnacle volume is shown when Pinnacle is currently running. Pinnacle volume is muted and needs to be unmuted in the popup. This will enable the sound to work again. Don't know how the sound was muted in the first place.

Don't know why Pinnacle 16 sound problem occurred, but it's possible that Windows updates may have affected the sound over time.

I'm currently using Windows 7 Home Premium.