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INTEREST RATE%) 05 10 15 20 25 30 YEARS TO MATURITY Based on an upward-sloping normal yield curve as shown, which of the following statements

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INTEREST RATE%) 05 10 15 20 25 30 YEARS TO MATURITY Based on an upward-sloping normal yield curve as shown, which of the following statements is correct? O Pure expectations theory must be correct. O There is a positive maturity risk premium. O Inflation must be expected to increase in the future. O If the pure expectations theory is correct, future short-ter m rates are expected to be higher than current short-term rates

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