The term structure of interest rates is a graphical presentation of the relationship between the maturity and rate of return.

Question

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The term structure of interest rates, also known as the yield curve, is a graphical representation of the relationship between the maturity and rate of return. It shows the different interest rates for bonds with different maturities, thereby indicating the expectations of investors about future interest rates and the economy in general.

The Term Structure of Interest Rates Is a Graphical Presentation