--%>
Assignment Help - homework help

Shapes of yield curves in marketplace

What are the three basic shapes of yield curves in the marketplace?

E

Expert

Verified

There are three basic shapes (slopes) of yield curves in the marketplace.

A) Ascending or normal yield curves are upward-sloping yield curves which take place when an economy is rising.

B) Descending or inverted yield curves are downward-sloping yield curves which take place when an economy is declining or heading into recession.

C) Flat yield curves entail that interest rates are improbable to change in the close future.

   Related Questions in Microeconomics

  • Q : Asymmetric Information on quality The

    The Asymmetric information on quality can outcome in: (i) Not all potential profits from the exchange being realized. (ii) Lower equilibrium prices. (iii) Purchases of unexpectedly low-quality items termed as ‘lemons’. (iv) Some transactio

    		•
  • Q : Financial Asset of Annual Income

    Perpetuity is a: (w) life insurance policy which matures upon retirement. (x) nondepreciable piece of capital. (y) financial asset which pays its owner an annual income forever. (z) pyramid scheme as a chain letter.

    Q : Long run economic profits for

    Long run economic profits for monopolistic competitors are prohibited by: (w) easy entry and exit. (x) the kinked demand curve. (y) barriers to entry. (z) diminishing marginal returns. Please choos

    		•
  • Q : Causes of Increase in demand Describe

    Describe the causes of Increase in demand?Answer: 1) Increase in income of the consumer.2) Price of substitute goods increase.3)

    		•
  • Q : Changes in price influencing supply

    Describe how changes in the prices of other products influence the supply of a specific product.

    		•
  • Q : Market Demand versus Individual Demand

    What is the difference between Market Demand and Individual Demand?

    		•
  • Q : Moderately increasing costs When this

    When this purely competitive industry is described by moderately increasing costs, in that case line C would represent: (w) the demand curve facing the entire industry as a whole. (x) market-period supply. (y) long-run market supply. (z) short-run sup

    		•
  • Q : Maximum consumer surplus A

    A characteristic Hollywood star derives the maximum consumer surplus from: (i) Calvin Klein underwear. (ii) Water. (iii) Mercedes Benz 600SEs. (iv) DeBeers diamonds. (v) Publicity in "The National Enquirer." Can so

    		•
  • Q : Reducing prices due to a commodity

    Which of the given would NOT be taken as predatory behaviour: (w) Rapid technological innovation. (x) Reducing prices due to a commodity surplus. (y) Duplicative products intended to absorb shelf space. (z) Introduction of close substitutes for rivals

    		•
  • Q : Causes of decrease in demand Illustrate

    Illustrate any three causes of decrease in demand? Answer: 1) Reduce in income of consumer. 2) Fall in the price of alternate good.3) Increase in the price of complementary goods.

    		•