Question: Explain Expectations Theory intuitively and with an example. In your example assume a flat yield curve with one- and two-year bonds at 6% and an

Explain Expectations Theory intuitively and with an example. In your example assume a flat yield curve with one- and two-year bonds at 6% and an expectation of next year's yield curve being flat with one- and two-year bonds at 4%. Explain the theory only in terms of the response to the expectation by investors. Please use calculations and graphs to show the changes in the yield curve

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