According to the Unbiased Expectations Theory

Multiple Choice

According to the unbiased expectations theory,

A) the term structure will most often be upward sloping.
B) liquidity premiums are negative and time varying.
C) the long-term spot rate is an average of the current and expected future short-term interest rates.
D) markets are segmented and buyers stay in their own segment.
E) forward rates are less than the expected future spot rates.