The market segmentation theory is the only theory that has any significant impact on interest rates.

Question

Quizplus · Accepted Answer

The market segmentation theory is one theory among several that attempt to explain interest rates. Other theories include the liquidity preference theory and the expectations theory. Each theory takes into account different factors that may affect interest rates, such as supply and demand for money, inflation expectations, and economic growth prospects.

The Market Segmentation Theory Is the Only Theory That Has