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The yield curve is the relationship between an interest rate and the time to maturity for a given debt. Typical debts may be U.S. Treasury debt instruments (T-Bills, T-Notes, etc.) or the LIBOR lending rate.

A yield curve is normally upward sloping, where short term lending would pay a lower rate (since it incurs less risk on the part of the borrower) compared to longer term lending (which places more risk on the borrower). In general the longer amount of time the lender loans money, the more that it earns as a result.

However, yield curves -- adjusted daily -- can vary in their shape depending on current economic conditions, long term market outlook, etc.

A yield curve describes the 'yield to maturity' of a collection of similar bonds (rating wise) with different periods to maturity. (src below)

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Q: What is the yield curve?
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