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    Exam 6: The Risk and Term Structure of Interest Rates
  5. Question
    If a Higher Inflation Is Expected,what Would You Expect to Happen
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If a Higher Inflation Is Expected,what Would You Expect to Happen

Question 94

Question 94

Essay

If a higher inflation is expected,what would you expect to happen to the shape of the yield curve? Why?

Correct Answer:

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The yield curve should have a steep upwa...

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