18) According to the expectations theory of the term structure when the yield curve is steeply upward sloping, short-term interest rates are expected to remain relatively stable in the future. when the yield curve is downward sloping, short-term interest rates are expected to remain relatively stable in the future. investors have strong preferences for short-term relative to long-term bonds, explaining why yield curves typically slope upward. yield curves should be equally likely to slope downward as slope upward. a. b. c. d