Suppose that the U.S. and Japan are both recovering from a recession, but the U.

Question

Suppose that the U.S. and Japan are both recovering from a recession, but the U.S. is expected to recover sooner.   Therefore, the yield curve for the U.S. would have a flatter slope than the yield curve for Japan.  

A) True

B) False

2)Once the economy reaches the natural rate of unemployment, the Federal Reserve is likely to wind-down quantitative easing. If the economy grows too quickly beyond this point, monetary policy may become more restrictive, which would lead to higher stock prices, ceteris paribus.

A) True

B) False

Explanation / Answer

1- A) True

2- B) False

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