Question: What is the relationship between the long - 4 erm interest rate and the short - term interest rate? The long - term interest rate
What is the relationship between the longerm interest rate and the shortterm interest rate?
The longterm interest rate
A fuchates more than the shortlerm rate because people borrow long lerm and lend ghort lerm
B is not influenced by current shortterm interest rates because people borrow long ferm
C is generally a bit higher than the shortlem interest rate because longlerm loans are riskier than shortterm loans
Ir peneraly a thit thigher than the shortlerm interest rate because banks prefer to make shortterm loans
E is not influenced by expectabions about thure shortherm interest rates because expectations change in the long run
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