Which one of these is included in the term structure of interest rates and remains constant over the term?

Question

Quizplus · Accepted Answer

The real rate of interest is included in the term structure of interest rates and remains constant over the term. It represents the compensation investors demand for forgoing consumption in the present in order to invest in projects that will yield payoffs in the future, adjusted for inflation. The other premiums (default risk, interest rate risk, liquidity, and inflation) can vary depending on market conditions and factors specific to the borrower or security.

Which One of These Is Included in the Term Structure