Economists' Attempts to Explain the Term Structure of Interest Rates

question 62

Multiple Choice

Economists' attempts to explain the term structure of interest rates

• A)illustrate how economists modify theories to improve them when they are inconsistent with the empirical evidence.
• B)illustrate how economists continue to accept theories that fail to explain observed behavior of interest rate movements.
• C)prove that the real world is a special case that tends to get short shrift in theoretical models.
• D)have proved entirely unsatisfactory to date.

---

Definitions:

Punctuated Equilibrium

A theory in evolutionary biology that suggests changes occur in rapid, short bursts followed by long periods of stability.

Midpoint Transition

A phase or moment of change in the middle of a process or project, often involving a shift in strategy, focus, or objectives.

Behavioural Scientists

Researchers and practitioners who study the interactions and behaviors of humans and animals within their environments.

Organizational Charts

Visual representations that illustrate the structure of an organization, showing relationships and ranks of jobs.