Interest Rate Explorer

Drag and drop the interest rate components to the correct categories! Each component can appear in multiple boxes. Feedback will show what should be in each box below.

Short-Term Treasuries

Long-Term Treasuries

Short-Term Corporate

Long-Term Corporate

r*
IP
MRP
DRP
LP

Component Explanations:

r*: Real risk-free rate, representing the base return with no risk or inflation.

IP: Inflation premium, compensating for expected inflation over the investment period.

MRP: Maturity risk premium, accounting for risks associated with longer investment durations.

DRP: Default risk premium, addressing the risk of non-payment by the borrower.

LP: Liquidity premium, added for investments that are not easily tradable or liquid.