Term Structure of Interest Rates
The Yield Curve
The yield curve [show graphic] depicts the yield-to-maturity for securities (bonds) vs. the time to maturity.
The Expectations Hypothesis
The Forward Rate
calculate vs. expectation
The Keynesian IS/LM Model with in its most basic form assumes that one interest rate is relevant for the IS Curve and the LM Curve. These interest rates are, in reality, the long-term interest rate and the short-term interest rate.
The Empirical Evidence