$0$

According to the liquidity premium theory of interest rates:

Multiple Choice

$01$:$18$:$42$

Skipped

long$-$term spot rates are totally unrelated to expectations of future short$-$term rates.

investors prefer certain maturities and will not normally switch out of those maturities.

References

long$-$term spot rates are higher than the average of current and expected future short$-$term rates.

the term structure must always be upward sloping.

investors are indifferent between different maturities if the long$-$term spot rates are equal to the average of current and expected future short$-$term rates.