Historically, most inverted yield curves have been caused by the Fed in an effort to:
A)increase economic growth.
B)slow inflation.
C)increase unemployment.
D)demonstrate their power.

Question

Quizplus · Accepted Answer

Most inverted yield curves have been caused by the Fed in an effort to slow inflation. When inflation is a concern, the Fed raises short-term interest rates, which can lead to an inverted yield curve as long-term rates do not rise as much or even fall. This can signal a potential economic slowdown or even recession.

Historically, Most Inverted Yield Curves Have Been Caused by the Fed