The relationship between yields and maturities of securities

The relationship between yields and maturities of securities is called __________.

the term structure of interest rates

the interest rate risk

liquidity preference theory

market segmentation theory

Solution

The relationship between yield and maturities of securities is called the term structure of interest rates. the yield and maturities relationship will be less than perfect. securities will lie exactly on the yield curve. the yield curve is the one which shows the relationship between yield to maturity and term to maturity for government securities.