Expectations about future short-term interest rates depend on expectations about which of the following?
A)future income
B)the money supply and inflation
C)long-term interest rates
D)both a and b are true

Question

Quizplus · Accepted Answer

Expectations about short-term interest rates are influenced by both future income and expectations regarding the money supply and inflation. Additionally, long-term interest rates may also have an impact on short-term rates as they reflect the expectations of investors about future economic conditions.

Expectations About Future Short-Term Interest Rates Depend on Expectations About