Explain the Intuition Behind the Link Between High Long Term

question 1

Essay

Explain the intuition behind the link between high long term yields and higher expected long term inflation.

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Definitions:

Buyers

Individuals or entities that purchase goods or services from a seller in exchange for money.

Per Unit

A measure expressing the cost, price, or quantity with respect to a single unit of goods or services.

Minimum-wage Laws

Legislation established to set the lowest hourly rate that employers can legally pay their workers, aimed at preventing exploitation and poverty.

Firms

Organizations that use various inputs to produce goods or services for sale to consumers, other businesses, or the government.