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The yield curve has a downward slope. According to the liquidity preference hypothesis A. long-term interest rates will rise B. short-term spot rates are expected
The yield curve has a downward slope. According to the liquidity preference hypothesis
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A. long-term interest rates will rise
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B. short-term spot rates are expected to rise
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C. short-term spot rates are expected to fall by less than implied by the term structure.
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D. short-term spot rates are expected to fall by more than implied by the term structure.
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