The course provides a unified, analytical framework for understanding financial markets, brings a fresh perspective to today’s major questions surrounding financial policy, the regulation of the financial system, and the internationalization of financial markets. Core economic principles and real-world examples organize students' thinking and keep them motivated. After studying students are well equipped to apply financial models, terms, and equations to decisions that affect both their personal and professional lives.
The goal of mastering the discipline
To make students to explore money, financial institutions, and the monetary-financial system in the modern economy. Emphasis will be placed on the demand and supply of financial assets, interest rate determination, commercial banking, the Central Bank activity, and the role of money in various models of the macro economy.
The skills you get
- By the end of the course the students will know: • the role of money and financial institutions in various models, how the demand and supply of money and other financial assets is determined, interest rate determination The students will be able to: • effectively analyze economic issues and data using appropriate economic modeling • critically evaluate economic public policies that pertain to monetary policy, fiscal policy, and regulation within the financial sector The students will have the experience in: • critical thinking and discussions of economic developments and concepts and results of economic policy
- I. Overview of Money and the Financial System: Introduction to financial sector and money II. Understanding Interest Rates: Present value, bond pricing formulas, real and nominal interest rates) III. Behavior of Interest Rates: Determinants of asset demand, diversification and risk, three interest-rate determination models: saving/investment, loanable funds, liquidity preference IV. Financial Structure and Commercial Banking: Financial institutions, financial structure, bank balance sheets, banking structure and regulation V. Central Banking: reserve system, intro to monetary policy tools, Central Bank independence VI. Money Supply: Monetary base, multiple deposit creation, money supply process VII. Monetary Policy: Fiscal versus monetary policy, monetary policy goals, application to present economy
- 2nd year, 2nd semester
List of references and sourses
Mishkin, Frederic S., The Economics of Money, Banking, and Financial Markets, 11th (12th) edition, Pearson education, – 2016, 2019.