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Fundamentals of Financial Manageme...

14th Edition
Eugene F. Brigham + 1 other
ISBN: 9781285867977

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BuyFindarrow_forward

Fundamentals of Financial Manageme...

14th Edition
Eugene F. Brigham + 1 other
ISBN: 9781285867977
Textbook Problem

Which fluctuate more—long-term or short-term interest rates? Why?

Summary Introduction

To identify: The interest rate, which fluctuates more: short-term interest rate or long-term interest rate.

Introduction:

Short-term interest rate:

The interest rate, which applies on the securities and which has the short maturity period of less than a year is known as the short-term interest rate.

Long-term Interest Rate:

The interest rate, which applies on the securities and which has the long maturity period of more than one year is known as the long-term interest rate.

Explanation
  • The long-term interest depends upon the demand and supply in the market which does not change frequently...

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