Assume that the rate on a 1-year bond is now 6%, but all investors expect 1-year rates to be 7% one year from now and then to rise to 8% two years from now. Assume also that the pure expectations theory holds, hence the maturity risk premium equals zero. Which of the following statements is CORRECT?
A. The yield curve should be downward sloping, with the rate on a 1-year bond at 6%.
B. The interest rate today on a 2-year bond should be approximately 6%.
C. The interest rate today on a 2-year bond should be approximately 7%.
D. The interest rate today on a 3-year bond should be approximately 7%.
E. The interest rate today on a 3-year bond should be approximately 8%.

Many levels of energy does an atom have?

technology is the application of knowledge and tools to solve problems and perform tasks more efficiently. t/f

Suppose an economist believes that the price level in the economy is directly related to the money supply, or the amount of money circulating in the economy. the economist proposes the following relationship: p=a x m - p=price level - m=money supply - a=a composite of other factors, including real gdp, that change very slowly over time. how might an economist gather empirical data to test the proposed relationship between money and the price level? an economist would persuade the federal reserve to change the money supply to various levels, and observe the resulting changes in the price level. unlike researchers in the hard sciences, economists cannot study complex relationships using data. economists do not usually develop theoretical models of the economy but only analyze summary statistics about the current state of the economy. an economist would look for data on past changes in the money supply, and note the resulting changes in the price level