The theory of the term structure of interest rates, which suggests that long-term rates are determined by the average of short-term rates expected over the time that a long-term bond is outstanding, is the

Expectations Theory

Explanation:

Victor Vroom's Expectancy Theory deals with motivation and management. Vroom's theory assumes that behaviour is a result of conscious choices among alternatives. The goal of options is to maximize pleasure and minimize suffering. Along with Edouard Lawler and Lyman Porter, Vroom suggested that the relationship between people's behaviour at work and their goals was not as straightforward as other scientists had first imagined it. Vroom realized that employee performance is based on different factors such as personality, skills, knowledge, experience and abilities.

Expectation theory states that people have different sets of goals and can be motivated if they have certain expectations.

EXPECTATIONS OF THE THEORY OF EXPECTATIONS include the following:

it's called a focal point