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Which of the following statements is most CORRECT? A. The spread between yield curves of corporate bonds and Treasury bonds is larger the longer the maturity because of maturity risk premiums. B. Suppose the Fed takes actions which lower expectations for inflation this year by 1 percentage point, but these same actions raise expectations for inflation in Years 2 and thereafter by begin with, 2 percentage points. Other things held constant, if the yield curve was normal to the yield curve will become less steep. C. The 10-Year Treasury yield is currently at 3.25 percent. D. If management is sure that the economy is at the peak of a boom and is about to enter a recession, a firm that needs to borrow money should probably use short-term rather than long-term debt. E. When the Fed fights a recession by reducing the interest rate, that is known as "loading the gun" to protect the economy.

Which of the following statements is most CORRECT? A. The spread between yield curves of corporate bonds and Treasury bonds is larger the longer the maturity because of maturity risk premiums. B. Suppose the Fed takes actions which lower expectations for inflation this year by 1 percentage point, but these same actions raise expectations for inflation in Years 2 and thereafter by 2 percentage points. Other things held constant, if the yield curve was normal to begin with, the yield curve will become less steep. C. The 10-Year Treasury yield is currently at 3.25 percent. D. If management is sure that the economy is at the peak of a boom and is about to enter a recession, a firm that needs to borrow money should probably use short-term rather than long-term debt. E. When the Fed fights a recession by reducing the interest rate, that is known as "loading the gun

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