Question #79
Reading: Reading 25 The Term Structure and Interest Rate Dynamics
PDF File: Reading 25 The Term Structure and Interest Rate Dynamics.pdf
Page: 31
Status: Unattempted
Correct Answer: A
Question
Volatility in long-term rates is most likely related to uncertainty about:
Answer Choices:
A. the real economy and inflation
B. fiscal policy
C. central bank actions
Explanation
Volatility in long-term rates is most likely linked to uncertainty about the real economy and
inflation, whereas volatility in short-term rates is most likely linked to monetary policy.