Investment Returns

This lecture covers the concept of discounting, focusing on intertemporal arbitrage, determining the right discount rate, and the factors influencing it. It explains compounding for future values, future and present value calculations, and broader arbitrage scenarios. The instructor illustrates the concepts with examples of start-up investments, rate of return, and interest rates. The lecture emphasizes the importance of comparing alternative investment opportunities through arbitrage to maximize returns. It concludes with a detailed analysis of investment returns and decision-making processes based on expected returns and interest rates.