Suppose the Expectations Hypothesis Is True

question 68

Multiple Choice

Suppose the expectations hypothesis is true.If the yield curve is flat this means that ________.

• A)investors do not expect interest rates to change in the future
• B)investors expect interest rates to rise in the future
• C)investors expect interest rates to fall in the future
• D)investors do not require a premium for expected inflation

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Definitions:

Hypothesis Testing

A statistical method used to determine if there is enough evidence in a sample of data to infer that a certain condition holds true for the entire population.

Research Hypothesis

An alternative to the null hypothesis, suggesting a significant difference or effect, that researchers aim to support through their findings.

Research Hypothesis

A specific, testable prediction about what you expect to happen in your study.

Inferential Statistics

The branch of statistics that makes predictions or inferences about a population based on a sample of data drawn from that population.