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Which of the following statements is false, if the Expectations Theory for the term structure of interest rates is valid? a. The liquidity premium increases
Which of the following statements is false, if the Expectations Theory for the term structure of interest rates is valid?
a. The liquidity premium increases with maturity
b. Forward rates depict the expectations for the future spot rates for the respective future period
c. Short and long-term interest rates are perfect substitutes
d. An upward sloping yield curve always corresponds to expectations for increasing interest rates in the future
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