The term structure of interest rates is
A)the relationship among interest rates of different bonds with the same maturity.
B)the structure of how interest rates move over time.
C)the relationship among the term to maturity of different bonds.
D)the relationship among interest rates on bonds with different maturities.

Question

Quizplus · Accepted Answer

The term structure of interest rates refers to the relationship among interest rates on bonds with different maturities. This is often represented graphically as a yield curve, which shows the yield (or interest rate) on bonds of different maturities. The shape of the yield curve can provide insight into market expectations for future interest rates and inflation.

The Term Structure of Interest Rates Is