The increase in the current federal funds rate leads market participants to expect future values of the federal funds rate to be higher. Since the yields or interest rates on longer term bonds is the average of the short term interest rates or yields expected over the life of the longer term bond plus a positive term premium, the longer term yields or interest rates that are relevant for decisions about purchasing interest sensitive goods also rise. As such, the yield curve twists and demand for interest sensitive goods is discouraged. The increase in the current federal funds rate leads market participants to expect future values of the federal funds rate to be higher. Since the yields or interest rates on longer term bonds is the average of the short term interest rates or yields expected over the life of the longer term bond plus a positive term premium, the longer term yields or interest rates that are relevant for decisions about purchasing interest sensitive goods fall. As such, the yield curve shifts and demand for interest sensitive goods is discouraged. The increase in the current federal funds rate leads market participants to expect future values of the federal funds rate to be higher. Since the yields or interest rates on longer term bonds is the average of the short term interest rates or yields expected over the life of the longer term bond plus a positive term premium, the longer term yields or interest rates that are relevant for decisions about purchasing interest sensitive goods falls. As such, the yield curve twists and the demand for interest sensitive goods is discouraged. The increase in the current federal funds rate leads market participants to expect future values of the federal funds rate to be higher. Since the yield or interest rates on longer-term bonds is an average of the short-term interest rates or yields expected over the life of the longer-term bond plus a positive term premium, the longer term yields or interest rates that are relevant for decisions about purchasing interest sensitive goods also rise. As such, the yield curve shifts and demand for interest sensitive goods is discouraged.Under conventional monetary policy, if the Fed believes that the rate of Inflation is too high, it attempts to discourage demand for interest sensitive goods such as consumer durables, housing, and investment in physical capital by increasing the federal funds rate which is a very short-term interest rate. However, the interest rates that are relevant for decisions about purchasing interest sensitive goods are longer-term interest rates. Assuming that the preferred habitat (or liquidity premium) theory of the term structure of interest rates holds, which of the following statements is the most accurate explanation for why the Fed's focus on the very short-term federal funds rate is consistent with its objective of discouraging demand for Interest sensitive goods