53、If investors expect stable rates of inflation in the future, the pure expectations theory suggests that the yield curve now will be: A. flat. B. humped. C. inverted. D. upward-sloping.
Correct answer = A
"Understanding Yield Spreads," Frank J. Fabozzi
2008 Modular Level I, Vol. 5, pp. 349-350
Study Session 15-65-c
explain the basic theories of the term structure of interest rates and describe the implications of each theory for the shape of the yield curve
The pure expectations theory explains the term structure in terms of expected future short-term interest rates. Assuming that interest rates reflect a relatively stable real rate of interest plus a premium for expected inflation, stability in inflation expectations would mean unchanged future short-term interest rates and a flat yield curve.
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发表于 2008-5-27 15:30
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