What is the difference between equilibrium model and no-arbitrage model for short-interest rate
Question
Solution 1
The equilibrium model and the no-arbitrage model are two different approaches used in the financial world to model short-term interest rates.
- Equilibrium Model: This model is based on economic theory and it assumes that the current state of the economy is in equilibrium. It tries to predict th Knowee AI is a powerful AI-powered study tool designed to help you to solve study problem.
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