the economics of money, banking, and financial markets

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44. 
    

    The steeply upward sloping yield curve in the figure above indicates that ____ interest
    rates are expected to ____ in the future.
    A) short-term; rise
    B) short-term; fall moderately
    C) short-term; remain unchanged
    D) long-term; fall moderately
    Answer: A
    Diff: 2 Type: MC Page Ref: 128
    Skill: Applied
    Objective List: 6.2 Explain how interest rates on bonds with different maturities are related

    
    


45. 
    

    The U-shaped yield curve in the figure above indicates that short-term interest rates are
    expected to ____.
    A) rise in the near-term and fall later on
    B) fall sharply in the near-term and rise later on
    C) fall moderately in the near-term and rise later on
    D) remain unchanged in the near-term and rise later on
    Answer: B
    Diff: 3 Type: MC Page Ref: 127
    Skill: Applied
    Objective List: 6.2 Explain how interest rates on bonds with different maturities are related