Multiple Choice
According to the expectations theory of term structure, if next year's short-term interest rate is expected to be above the current short-term rate, the
A) current long-term rate will be equal to the current short-term rate.
B) current long-term rate will be below the current short-term rate.
C) current long-term rate will be above the current short-term rate.
D) yield curve will have a negative slope.
Correct Answer:
Verified
Correct Answer:
Verified
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