Estimating Forward Rates from the Spot Rate Curve Is Based

question 107

Multiple Choice

Estimating forward rates from the spot rate curve is based on the assumption that the ____ hypothesis accurately describes the shape of the yield curve.

• A) Expectations
• B) Liquidity preference
• C) Segmented market
• D) Efficient market
• E) None of the above

---

Definitions:

Fraud

Purposeful falsehood carried out to obtain personal advantages or to injure someone else.

Substantial Beginning

A substantial beginning refers to a significant amount of work or progress that has occurred, typically in the context of a project or endeavor.

Unenforceable

Refers to a term or contract that cannot legally be enforced by the courts due to various reasons such as violating law or being against public policy.

Complaint

A formal legal document that initiates a lawsuit, detailing the facts and legal reasons the plaintiff believes are sufficient to support a claim against the defendant.