= 2 Investors expect short-term rates to decrease in the near future. However, they demand positive liquidity premium. Is the resulting yield curve going to be upward or downward slopping? Explain why. points) 5. An investor buys a stock if price rises 5% from the 250-day low and shorts a stock if price falls 5% from the 250-day high. What is this strategy called? Will it work if the market is efficient? Explain why. (4 points) 6. Explain why APT model is an improvement over CAPM? (5 points) 55