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Suppose the yield curve is upward sloping. According to the expectations theory of the yield curve and its common interpretation as a business cycle indicator:

Suppose the yield curve is upward sloping. According to the expectations theory of the yield curve and its common interpretation as a business cycle indicator:

a. The Fed will raise short-term rates in the future to fight inflation.

b.The Fed will decrease short-term rates in the future to reduce rising unemployment.

c. The Fed will decrease short-term rates in the future to reduce inflation.

d. The Fed will raise short-term rates in the future to reduce rising unemployment.

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