A Moderately Upward-Sloping Yield Curve Indicates That Short-Term Interest Rates

question 8

Multiple Choice

A moderately upward-sloping yield curve indicates that short-term interest rates are expected to

• A) neither rise nor fall in the near future.
• B) remain relatively unchanged, but that long-term rates are expected to fall.
• C) neither rise nor fall, but that long-term rates are expected to rise moderately.
• D) rise moderately in the near future.

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Definitions:

Reflexive

Pertaining to or characterized by reflex action; automatic and involuntary response to stimuli.

Primary Circular Reactions

Repetitive actions in very young infants, which serve to build the infant’s own sensory-motor coordination.

Pleasurable Actions

Activities or behaviors that produce feelings of enjoyment or satisfaction.

Classical Conditioning

A learning process in which a neutral stimulus becomes associated with a meaningful stimulus and acquires the capacity to elicit a similar response.