Question: Multiple - Choice: - Conceptual Assume that inflation is expected 4 0 decline steadily in the future, but shat shereal - sisk - free -
MultipleChoice:Conceptual
Assume that inflation is expected decline steadily in the future, but shat sherealsiskfreefate, will remain constant. Which of the following statements is CORNECT, other things field constant?
Hithe pure expectations theory holds, the Treasury yieldcurve must be downward sioping.
If the pure expectations theory holds, thecorporate yield curve anust bedownward stoping.
If thereis apositive maturity sisk premium, the Treasury yied curvemust beapwardsloping.
Ifinflation as expected decline, there can benomaturity siskpremium.
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