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    Exam 7: The Risk and Term Structure of Interest Rates
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    The Usually Upward Sloping Yield Curve Indicates That Long-Term Bonds
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The Usually Upward Sloping Yield Curve Indicates That Long-Term Bonds

Question 11

Question 11

Essay

The usually upward sloping yield curve indicates that long-term bonds have higher yields than short-term bonds. Why is this?

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Bondholders face both inflatio...

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