Interest Rates
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Which of the following would be most likely to lead to a higher level of interest rates in the economy?
Corporations step up their expansion plans and thus increase their demand for capital.
Which of the following statements is CORRECT?
If expected inflation increases, interest rates are likely to increase.
Assume that the current corporate bond yield curve is upward sloping, or normal. Under this condition, then we could be sure that
Maturity risk premiums could help to explain the yield curve's upward slope.
If the Treasury yield curve is downward sloping, how would the yield to maturity on a 10-year Treasury coupon bond compare to that on a 1-year T-bill?
The yield on a 10-year bond would be less than that on a 1-year bill.
