If the Yield Curve Slope Is Flat,the Liquidity Premium Theory

Multiple Choice

If the yield curve slope is flat,the liquidity premium theory indicates that the market is predicting

A) a mild rise in short-term interest rates in the near future and a mild decline further out in the future.
B) constant short-term interest rates in the near future and further out in the future.
C) a mild decline in short-term interest rates in the near future and a continuing mild decline further out in the future.
D) constant short-term interest rates in the near future and a mild decline further out in the future.