An inverted yield curve implies that:
A)Long-term interest rates are lower than short-term interest rates.
B)Long-term interest rates are higher than short-term interest rates.
C)Long-term interest rates are the same as short-term interest rates.
D)Intermediate term interest rates are higher than either short- or long-term interest rates.
E)none of the above.

Question

Quizplus · Accepted Answer

An inverted yield curve occurs when long-term interest rates fall below short-term interest rates, indicating potential economic slowdown or recession.

An Inverted Yield Curve Implies That