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CFA Level 2
Fixed Income

Understanding Yield Curve Construction

Easy Term Structure Dynamics Yield Curve Construction

As a fixed income analyst, you are tasked with constructing a yield curve based on the current interest rates of various maturities. You understand that the yield curve represents the relationship between interest rates and different maturities on debt for a given borrower in a particular currency.

Which of the following statements regarding the yield curve construction is true?

Hint

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