What is the shape of the yield curve given the term structure below? What expectations are investors likely to have about future interest rates? Term 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr Rate (EAR %)

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What is the shape of the yield curve given the term structure below? What expectations are investors likely to have about future interest rates? Term 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr Rate (EAR %)

What is the shape of the yield curve given the term structure below? What expectations are investors likely to have about future interest rates?

Term

1 yr

2 yr

3 yr

5 yr

7 yr

10 yr

20 yr

Rate (EAR %)

college finance

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Answer 1

Answer #1

What is the shape of the yield curve given the term structure below?

Answer: The yield curve is a normal yield curve (increasing).

What expectations are investors likely to have about future interest rates?

Answer: Interest rates might rise in the future.

answered by: Andrew San Andres

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Answer 2

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What is the shape of the yield curve given the term structure below? What expectations are investors likely to have about future interest rates? Term 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr Rate (EAR %)

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What is the shape of the yield curve given the term structure below? What expectations are investors likely to have about future interest rates? Term 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr Rate (EAR %)