ࡱ> knj ~bjbj BORll+++???8wtL?nM7MMM/   LLLLLLL$O&RPM+ " MM/(M5%5%5% |M8L5% L5%5%EHM1S?!G"L>M0nM)GvR##vRDHHzvR+-I - 5%; G X   MM;$   nM vR         l u:  Department of Economic 91Ƶ Spring 2010 Shah Dabirian, Ph.D. Money and Banking Econ 320 Money and Banking Objectives: Course Description and Student Learning Outcomes- 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 their determination; the operations and behavior of banks and other financial institutions, including mutual funds; the money-creation process; the effect of money and credit on production, employment, and inflation; 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. Learning objectives: At the end of this course, students will be able to define money and to understand its use to calculate interest rates on bonds to predict how interest rates change in response to outside economic changes to explain how banks use a balance sheet to explain important banking regulations in the US to explain how the Federal Reserve System functions to explain how money is created by banks to explain how the foreign exchange market and aspects of the international financial system work to predict how monetary policy influences inflation, production and employment Office: Sage Hall # 2016 Email: sdabirian@csuci.edu Office hours: Mondays 8 to 9: PM.--And by Appointment Required Text: The Economics of Money, Banking and Financial Markets by Frederic S. Mishkin (8th edition, Pearson, Addison, Wesley, 2007) Course website:  HYPERLINK "http://blackboard.csuci.edu" http://blackboard.csuci.edu Evaluation Procedures and Grading Student performance will be evaluated on the basis of two one-hour exams, the final exam, and homework and class assignments. The grades will be based on 25% for each of the two midterms, 30% for the final, and 20% for the class assignments and participation. Grading Semesters Grade Determination Grading Scale 50% Two mid-term exams 90 to 100% A 30% Final Exam 80 to 89% B 20% Homework 70 to 79% C 60 to 69% D 60% or Less F Incompletes and Late Withdrawal Incomplete grades will only be awarded under extraordinary circumstances. Not doing well in the course does not constitute an extraordinary circumstance. To avoid being assigned failing grades, students who decide not to complete the class must withdraw themselves from the class in accordance with the procedures described in the University catalog. Drop Policy According to University policy, non-attendance does not constitute withdrawal; to withdraw from this class you must file a drop form with the University. If you fail to attend this class, and you do not formally drop the class, a "WU" (unauthorized withdrawal), the equivalent of a failing grade, will be recorded. Academic Dishonesty University rules prohibit cheating, fabrication, facilitating the academic dishonesty of another student, and plagiarism. In accordance with the CSU Channel Islands policy on academic dishonesty, students in this course who submit the work of others as their own (plagiarize), cheat on tests and examinations, help other students cheat or plagiarize, or commit other acts of academic dishonesty will receive appropriate academic penalties, up to and including failing the course. Disability Accommodation Services Students with disabilities needing accommodation, make requests to, Disability Accommodation Services, East Bell Tower, 1796. Please discuss approved accommodations with me. Course Outline and Chapter Assignments Lecture Schedule I. Introduction to Money and Banking Understanding the role of finance in the economy. The definition of money and an overview of the financial system. Jan. 25 Ch. 1 - Why Study Money, Banking and Financial Markets? Ch. 2 - An Overview of the Financial System. Feb 1 Ch. 3 - What is Money? II. Financial Markets and Understanding Interest Rates How to calculate and analyze interest rates. Interest rates in a theory of asset demand. Why interest rates rise and fall. The significance of the term structure of interest rates and the risk structure of interest rates. Feb 1 Ch. 4 - Understanding Interest Rates. 8 Ch. 5 - The Behavior of Interest Rates. Ch. 6 - The Risk and Term Structure of Interest Rates. 15 Holiday 22 Ch. 7 - The Sock Market, the Theory of Rational Expectations. First Mid-Term Exam (Ch.1-6) III. Financial Institutions Analysis of the activities of bank firms and the banking industry. Problems of bank management. Insights provided by duration analysis. An explanation of arbitrage, speculation, hedging and the use of financial futures markets. The continuing crisis in banking and the role of regulation in controlling the banking industry. March. 1 Ch. 8 - An Economic Analysis of Financial Structure. Ch. 9 - Banking and the Management of Financial Institutions. 8 Ch.10 - The Banking Industry. Ch.11 - Economic Analysis of Banking Regulation. 22 Spring Break 29 Second Mid-Term Exam (Ch. 7-11) . IV. The Money Supply Process Central Banking and the Conduct of Monetary Policy. April. 5 Ch.12- Structure of Central Banks and the Federal Reserve System Ch. 13- Multiple Deposit Creation. 12 Ch. 14- Determinants of the Money Supply. Ch. 15- The Tools of Monetary Policy. 19 Ch. 16- What should Central Banks Do? Monetary Policy Goals. Ch. 17- The Foreign Exchange Market 29 Ch. 18 -The International Financial System. V. Monetary Theory Understanding the importance of money in macro-economic theory. Does money matter? 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