The Term Structure of Interest Rates

question 99

Multiple Choice

The term structure of interest rates:

• A) is based on historical yields.
• B) is based on current yields.
• C) is based on future yields.
• D) is based on current and future prices.

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Definitions:

Two-factor Theory

The Two-factor Theory proposes that human emotions are the result of a combination of physiological arousal and the cognitive labeling of that arousal.

Drive Reduction Theory

A motivational theory proposing that the maintenance of homeostasis motivates behavior that reduces drives arising from physiological needs.

James-Lange Theory

A psychological theory suggesting that emotions result from people's interpretations of bodily reactions to external events.

Cannon-Bard Theory

The proposition that emotion and physiological reactions occur simultaneously.