The expectations theory and the segmented markets theory do not explain the facts very well, but they provide the groundwork for the most widely accepted theory of the term structure of interest rates,

The expectations theory and the segmented markets theory do not explain the facts very well, but they provide the groundwork for the most widely accepted theory of the term structure of interest rates,




A) the Keynesian theory.
B) separable markets theory.
C) liquidity premium theory.
D) the asset market approach.






Answer: C


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