A downwards-sloping yield curve is often viewed as a sign that a recession is imminent. This is because: A. If the Federal Reserve thinks that a recession is imminent, it buy short-term securities, thus raising their interest rates relative to long-term interest rates. The Federal Reserve lowers interest rates in a recession, and if investors think a recession is imminent, then the pure expectations theory says that the yield B. curve should be downward sloping. During a recession, investors become less risk averse over the long-term, and according to the risk-premium theory, this reduces long-term rates resulting in C. a downward sloping yield curve. Because interest rates are lower in recessions, bond traders want to get out while interest rates are still high, and this kind of market segmentation lowers D. Ionger-term rates relative to short-term rates