When the Yield Curve Is Downward-Sloping

question 81

Multiple Choice

When the yield curve is downward-sloping,

• A)short-term yields are higher than long-term yields.
• B)long-term yields are higher than short-term yields.
• C)the bond market is anticipating the U.S. Treasury may default on its obligations.
• D)the inflation rate is expected to rise.

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Definitions:

Photosynthesis

The process by which green plants and some other organisms use sunlight to synthesize nutrients from carbon dioxide and water, producing oxygen as a byproduct.

Oxygen

A chemical element with symbol O, essential for cellular respiration in most living organisms and a major component of Earth's atmosphere.

Metabolic Pathways

Sequences of chemical reactions that occur in a cell, transforming substrates into products and energy.

Sunlight

The natural light emitted by the Sun, which is a primary energy source for Earth's climate system and necessary for photosynthesis in plants.