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The video introduces consolidation settlement concepts and calculations. It starts by discussing stresses on a bar and the stress-strain relationship for a material with linear elasticity. Stress is defined as the modulus of elasticity times strain, and strain is the change in length over the original length. The relationship between stress, strain, modulus of elasticity, and change in length is explained for a bar under stress. This sets the foundation for more complex cases of consolidation settlement calculations.