An upward- sloping yield curve suggests that financial market participants expect short- term interest rates will:
A) be equal to zero in the future.
B) not change in the future.
C) rise in the future.
D) be unstable in the future.
E) fall in the future.

Question

Quizplus · Accepted Answer

An upward-sloping yield curve means that long-term interest rates are higher than short-term interest rates. This suggests that investors expect short-term interest rates to rise in the future, leading to an increase in overall yields.

An Upward- Sloping Yield Curve Suggests That Financial Market Participants