In an effort to maintain price stability, it is expected that the European Central Bank will raise interest rates in the future. Which of the following is the most likely effect of such an action on short-term and long-term interest rates in Europe?

Group of answer choices

Long-term interest rates will be about the same as short-term interest rates.

Long-term interest rates will tend to be higher than short-term interest rates.

No relative change in short- and long-term interest rates could be predicted.

Both long- and short-term interest rates would be expected to fall sharply.

The yield curve is expected to become inverted.