# Question: Answer the below questions a Why is the most common interest rate

Answer the below questions.

(a) Why is the most common interest-rate model used to describe the behavior of interest rates a one-factor model?

(b) What is the one-factor in a one-factor interest-rate model?

(a) Why is the most common interest-rate model used to describe the behavior of interest rates a one-factor model?

(b) What is the one-factor in a one-factor interest-rate model?

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