The yield curve represents:
A) The relationship between bond yields and stock returns.
B) The relationship between default risk and time to maturity.
C) The relationship between short-term and long-term interest rates.
D) The relationship between risk and return.
E) The relationship between yield and price.

Question

Quizplus · Accepted Answer

The yield curve represents the relationship between short-term and long-term interest rates, typically of bonds of the same credit quality. It is a graphical representation showing how the yields on bonds of different maturities compare.

The Yield Curve Represents