expectationsareaboutrates,becausetheyprefertoholdshort-termmaturitybonds,they requireayieldpremiumtobuylongertermbonds.Whenthemarketanticipateslowerrates, theliquiditypremiumwilldampenthedownwardslopeoftheyieldcurve. Alternativeapproachtotheanswer:Spotratesareageometricaverageofforwardrates. Whenratesareexpectedtofall,in...