Money and Banking

COURSE DESCRIPTION :
The course provides insight into the role financial markets play in the business environment that students will soon be facing. It explores the application of economic and financial principles to everyday events often faced by actors in financial markets such as bankers, fund managers, and financial directors.

This course is an introduction to the U.S. monetary and banking system. Course topics include financial instruments and their purposes; aspects of portfolio management and people's demand for financial assets; interest rates and what determines them; the operations of banks and other financial institutions; the role of the Federal Reserve as the central bank in the U.S. banking system; the history of central banking in the U.S.; and international dimensions of monetary policy and financial markets.

INSTRUCTIONAL METHODOLOGY :
The course consists of class lectures, individual/group presentations on various assignments. Will be covered in class :
- Introduction : History of money and the origin of banks
Basic Financial Institutions,
- Basic interest rates, supply and demand bond markets, risk and term structure of interest rates
- Stock markets and efficient market theory
- Economics of financial structure, adverse selection, moral hazard
- Bank management: liability, asset, capital adequacy management
- Banking regulations
- Central banks and the federal reserve system

TEXTBOOK:
Mishkin, F, The Economics of Money, Banking and Financial Markets, Pearson Education.

EVALUATION :
The final grade will be made up of a class participation (10%), a mid-term test (40%) and the final examination (55%).