Even though the Yield Curve has accurately predicted the last sevenrecessions, why is it that today many economists are not so concerned about its recentinversion?

A.

Recently, many foriegn investors have purchased intermediate to long term treasury bonds which forces rates on these instruments down.

B.

The term premium sometimes called the liquidity premium has recently increased to over a value of 2

C.

Many more American investors are buying forign bonds

D.

Recently, the Treasury has sold a large amount of long term bonds.

Even though the Yield Curve has accurately predicted the last sevenrecessions, why is it that today many economists are not so concerned about its recentinversion?

A.

Recently, the Treasury has sold a large amount of short term bonds.

B.

The term premium sometimes called the liquidity premium has recently increased to a value of close to ten.

C.

Many fewer American investors are buying forign bonds

D.

Recently, many foriegn investors have purchased short term treasury bonds which forces rates on these instruments down.

Even though the Yield Curve has accurately predicted the last sevenrecessions, why is it that today many economists are not so concerned about its recentinversion?

A.

Recently, the Treasury has sold a large amount of long term bonds.

B.

Many fewer American investors are buying forign bonds

C.

Recently, many foriegn investors have purchased short term treasury bonds which forces rates on these instruments down.

D.

The term premium sometimes called the liquidity premium has recently decreased to a value of close to zero.

If the expected path of year interest rates over the next four years is 5percent, 4percent, 2percent, and 1percent, then the expectations theory predicts thattoday's interest rate on the fouryear bond is how many percentage