Three theories commonly used to explain the term structure of interest rates include all of the following EXCEPT
A)the default risk theory
B)the expectations theory
C)the market segmentation theory
D)the liquidity preference theory

Question

Quizplus · Accepted Answer

The three commonly used theories to explain the term structure of interest rates are the expectations theory, the market segmentation theory, and the liquidity preference theory. The default risk theory is not one of them.

Three Theories Commonly Used to Explain the Term Structure of Interest