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In some time periods there is evidence that corporations initially financed long-term projects with short-term funds. They planned to borrow long-term funds once interest rates were lower. This specifically supports the ____ for explaining the term structure of interest rates. Question 1 options: 1) liquidity premium theory 2) expectations theory 3) segmented markets theory 4) A and C

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sandlee09

Answer:

expectations theory

Explanation:

According to my research on business strategies, I can say that based on the information provided within the question this specifically supports the expectations theory for explaining the term structure of interest rates. Basically like mentioned in the question, Expectations theory attempts to predict what short-term interest rates will be in the future based on current long-term interest rates.

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