The term structure of interest rates, also known as the yield
curve, is a very common bond valuation method. Constructed by
graphing the yield to maturities and the respective maturity
dates of benchmark fixed-income securities, the yield curve is a
measure of the market's expectations of future interest rates
given the current market conditions. Treasuries, issued by the
federal government, are considered risk-free, and as such, their
yields are often used as the benchmarks for fixed-income
securities with the same maturities. The term structure of
interest rates is graphed as though each coupon payment of a
noncallable fixed-income security were a zero-coupon bond that
"matures" on the coupon payment date. The exact shape of the
curve can be different at any point in time. So if the normal
yield curve changes shape, it tells investors that they may need
to change their outlook on the economy.  There are three main
patterns created by the term structure of interest rates:  1)
Normal Yield Curve: As its name