When the yield curve slopes upward: Yields on 30-year Treasury bonds are greater than those on seven-year notes, which are in turn greater than those on six-month bills. As all Treasury securities have the same default risk, liquidity, and tax treatment, should you invest all your money in the 30-year bonds according to the expectations theory?

Answer rating: 100% (QA)

According to the expectations theory which suggests that longterm interest rates are determined by t... View the full answer