7. (15 points) Analytical question, please do not work any numbers. What is the shape of the yield curve given in the following term structure? What expectations are investors likely to have about future interest rates? Term Rate (EAR %) 1 year 2 years 3 years 5 years 7 years 10 years 20 years | 2.02 | 2.43 | 2.75 | 3.31 | 3.75 | 4.14 | 4.94 What is the shape of the yield curve given the term structure? a. It is hard to tell because we are not given an EAR for every year. b. The yield curve is a flat yield curve because it rises one year at a time c. The yield curve is an inverted yield curve (decreasing). d. The yield curve is a normal yield curve (increasing). Given the term structure stated above, explain what expectations are investors likely to have about future interest rates. How those expectations influence the shape of the yield curve