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What is meant by the term structure of interest rates?

What is meant by the term structure of interest rates?

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Ans. Term structure of interest rates are also commonly known as the yield curves depicts the interest rates of similar quality of bonds at different maturity dates.

In general, term sturcture of interest rates is the relationship between interest rates and different terms or maturities. On a graph the term structure is known as yield curves. The term structure reflects the expectations of market participants about future changes in interest rates and their assessment of monetary policy conditions in the economy.

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