A downward-sloping yield curve is evidence

a. both the preferred habitat and liquidity premium theories of the yield curve, because the expectations theory suggests it is always perfectly flat.

b. for none of the theories unless we have more information about what short term interest rates are expected to be in the future.

c. for the expectations theory of the yield curve because it is the only theory that accounts for a downward sloping yield curve.

d. for the preferred habitat theory of the yield curve because none of the other theories are consistent with this observation.