What does the slope of the yield curve tell us?Suppose that economy is in recessionand monetary...

What does the slope of the yield curve tell us?Suppose that economy is in recessionand monetary authority decreases policy rate (interest rate) toreturnoutput to itspotential level.Illustrate using relevant graphs when the yield curve is i) approximatelyhorizontal ii) downward sloping(Hint: Useexpectations augmentedIS-LMmodel)

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Rahul Sunny answered 3 months ago

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