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This lecture discusses the Michelson-Morley interferometer and the detection of minimal mirror displacement through observed fringes. It explains the resolution criterion based on a total phase shift of pi, leading to an alternation between maximum and minimum. By setting the phase shift to pi and relating it to the difference in length, the lecture derives the mirror displacement as lambda/4 for a given wavelength of 400 nanometers, allowing detection up to 100 nanometers.