Assume the expectations hypothesis regarding the term structure of interest rates is correct. Then, if the current two-year interest rate is 5% and the current one-year rate is 6%, then investors expect the future one-year rate to be:
A. 6%.
B. 5%.
C. 4%.
D. 1%.
Answer: C
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A nonmonetary opportunity cost is called a(n) ________, while a cost that involves spending money is called a(n) ________.
A) implicit cost; explicit cost B) normal rate of return; asset C) accounting profit; economic profit D) accounting cost; explicit cost
Refer to Scenario 25-2. As a result of Kristy's deposit, Bank A's reserves immediately increase by
A) $2,000. B) $8,000. C) $10,000. D) $50,000.
Discuss some of the factors that lead infant manufactured goods industries to become more efficient over time, and some of the factors that might lead them to fail to do so
What will be an ideal response?
Rents for stores at shopping malls are usually tied to the profits of the store. Comment on how this arrangement affects the mall owner's income versus a fixed rent
What will be an ideal response?