Question: Question 4 - [6 marks) The term structure at a given time reflects the market's current expectations on future short-term rates. Starting from a flat

Question 4 - [6 marks) The term structure at a given time reflects the market's current expectations on future short-term rates. Starting from a flat yield curve, explain how the following would respond to an expectation of decreasing short-term future interest rates: market participants interested in a long-term investment speculators and borrowers What would it imply for the shape of the yield curve? Det

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