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If Long-Term Interest Rates Are 8% and Short-Term Rates Are

Question 13

Multiple Choice

If long-term interest rates are 8% and short-term rates are 3%, the market expects:


A) short-term rates to fall.
B) short-term rates to rise.
C) short-term rates to remain the same.
D) there is no relationship between long-term and short-term rates.

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