This is the difference between the two.

And this one that was in Kenya, they went around and distributed to people vouchers, discount vouchers.

The probability of reaching S prime given that we started state S and apply action A.

Discount rate

Now what can we do ?

I have some coupons I got last week.

Are there special evening rates?

And it just depended on how the mathematics work out.

I thought we had discussed a cash discount.

Do you have a student fare?

60 off.

So x minus twenty five percent x is equal to the sale price.

We could have also done it other way.

Let's say in every year it's going to make 1.

These are 30 percent off.

Will you give any discount if I pay in cash?

That's really important for now, just for this one quiz.

Be silent. Keep your forked tongue behind your teeth.

Are there any discount tickets for me?

Well, that was x.

Another way to kind of just talk about this is to get the present value of 110 a year from now, we discount the value by a discount rate.

We could have said Let y equal the discount

5 minus this 2.

What is it about Superman?

when the sale has a certain percentage ?

I bought the car at a 10 discount.

Free coupons. Discount Discount coupons.

Well, I don't give group rates, you know.

The store offered special discounts during the summer.

If I could get it for 90, that's a good deal for me.

But what if I wanted to generalize a little bit ?

Special rates for state and federal employees.

Then we get the Q value of 100 minus the Q value of zero, and the discount rate is 90.

Then to discount money in the future to the present, we divide it by 1 plus the discount rate so this is a 5 discount rate.

Thirty percent off for USC alumni.

Perhaps only at a discount.

And this discount rate, this is where all of the fudge factor occurs in finance.

You should discount his story.

You'd better take his words with a grain of salt.

But let's generalize even more.

That's a family discount in these hard times.

For new customers, the store offers a one time discount of 3.

So 2009 money, that's worth 1.

Let x be the price of the product I want to buy, the nondiscount price of the product in the store.

It easy to show that this expression over here will always be smaller or equal to 1 over 1 minus gamma times the absolute reward maximizing value and which in this case would be plus 100.