Exam 1 review · Lesson 10 of 45
Yield Curves & the Expectations Theory
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Exam 1 review · Lesson 10 of 45 · 14 min
Yield Curves & the Expectations Theory
Read the shape of the yield curve, then use the expectations theory to pull out the future rates and future inflation the market is pricing in.
Inside this lesson
- Why this matters
- The core idea
- The formula
- Worked example 1: next year's 1-year rate
- Worked example 2: inflation implied by a yield spread
- Your turn
- Calculator steps
- Common mistakes
- Quick check
- Key takeaways
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