The Term Structure of Interest Rates

question 94

Multiple Choice

The term structure of interest rates

• A) represents the relationship among the interest rates on bonds that are otherwise similar but that have different maturities.
• B) reflects differing tax treatment received by different instruments.
• C) always results in an upward-sloping yield curve.
• D) usually results in a downward-sloping yield curve.

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Definitions:

Relationship Maintenance

The actions and activities used to sustain the desired quality of a relationship.

Active Relationship Maintenance

Efforts made consciously by individuals in a relationship to preserve, protect, and enhance their connection.

Assurance

A positive declaration intended to give confidence; a promise.

Rule Of Reciprocity

A social norm where individuals feel obliged to return favors or kindness received from others.