Interest rates spreads between long-term and short-term Treasury bills ________.
A)are countercyclical
B)are good predictors of recessions
C)are a lagging indicator
D)all of the above
E)none of the above

Question

Quizplus · Accepted Answer

Interest rate spreads between long-term and short-term Treasury bills are often used as a predictor of recessions, as an inverted yield curve (where short-term rates are higher than long-term rates) has historically preceded economic downturns.

Interest Rates Spreads Between Long-Term and Short-Term Treasury Bills ________