According to the liquidity premium theory of the term structure, a flat yield curve indicates that short-term interest rates are expected to
A) rise in the future.
B) remain unchanged in the future.
C) decline moderately in the future.
D) decline sharply in the future.
C
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If a perfectly competitive firm is producing an output level for which MR equals $5, MC equals $6, and ATC equals $4, the firm
a. is earning a profit but should reduce output. b. is earning a profit and should increase output. c. is suffering a loss and should reduce output. d. is suffering a loss but should increase output.
Income elasticity has a range of
A) greater than or less than one. B) greater than or less than zero. C) greater than or less than negative one. D) less than zero but greater than one.
The interest rate effect operates through
A. the purchasing power of individuals' checking accounts. B. government spending levels. C. labor supply. D. credit markets by changing borrowing costs.
Antitrust laws are essentially:
A. Anti-monopoly B. Anti-banking C. Anti-finance D. Anti-competition