Question: Term Structure and the Loanable Funds Market State whether each of the follow - ing effects contribute to an increase or decrease in i )

Term Structure and the Loanable Funds Market State whether each of the follow-
ing effects contribute to an increase or decrease in i) the demand of short-term funds, ii) the
supply of short-term funds, iii) the demand of long-term funds, iv) the supply of long-term
funds, v) current short-term rates (i1,t), and vi) current long-term rates ( i2,t):
a) Risk Effect
b) Expectations Effect if future short-term rates are expected to be constant
c) Expectations Effect if future short-term rates are expected to increase
d) Expectations Effect if future short-term rates are expected to decrease

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