Which Term-Structure Hypothesis Suggests That Any Long-Term Interest Rate Simply

question 11

Multiple Choice

Which term-structure hypothesis suggests that any long-term interest rate simply represents the geometric mean of current and future on-year interest rates expected to prevail over the maturity of the issue?

• A) Expectations hypothesis
• B) Liquidity preference hypothesis
• C) Segmented market hypothesis
• D) Preferred habitat hypothesis
• E) Hedging pressure hypothesis

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