An inverted yield curve is said to be a reliable predictor of recessions. When the yield curve inverts, this is when there is a _________ value of the _____________. (federal funds rate is a short-term rate, namely the target interest rate at which commercial banks borrow and lend their excess reserves to each other overnight)

1. negative, ten-year bond rate minus federal funds rate
2. positive, ten-year bond rate minus federal funds rate
3. positive, corporate bond rate minus federal funds rate

negative, corporate bond rate minus federal funds rate