Under the Expectations Hypothesis, If Expectations Are for Lower Inflation

question 45

Multiple Choice

Under the expectations hypothesis, if expectations are for lower inflation in the future than what it currently is, the yield curve's slope:

• A) Will become more upward sloping
• B) Will become flat
• C) Will be negative
• D) Will be vertical

---

Definitions:

Covert Positive Reinforcement

A technique in behavioral psychology where positive outcomes are indirectly provided to reinforce desired behaviors without the subject's direct awareness.

Bootleg Reinforcers

Unplanned or unauthorized rewards that can maintain or increase an undesired behavior, often complicating behavior modification efforts.

Self-Reinforcement

A phase of self-management and an intervention technique. The process involves teaching students to either provide themselves with a tangible reinforcer after completing a desired behavior or engage in positive self-statements. Self-evaluation and self-monitoring are necessary prerequisites.

Self-Monitoring

A technique in which individuals observe and record their own behaviors as a way to increase awareness and facilitate behavior change.