This course studies the role of money, the financial markets, central banks, the financial institutions, the banking system and monetary policy in the economy. We will start with an introduction to the payment system, the financial system and basic concepts in financial economics such as the notion of risk, the present or future value, the determination of interest rates and the term structures. Then, we will discuss topics related to banking management, the regulation of financial system, the role of central banks and their functions. We will also study how monetary policy affects the economy. This course will focus on the Canadian financial system.
ECON 101 and ECON 102 are prerequisites for this course.
Lectures: Monday and Thursday 1:00 PM to 4:30 PM; Room: ART 210
Office Hours: By appointment.
Syllabus
Required Textbook: Stephen G. Cecchetti and Angela Redish, Money, Banking and Financial Markets (1st Canadian Edition), McGraw-Hill Ryerson Higher Education 2010.
Online Quizzes
Grades
- First Midterm Test
- First Assignment
- Second Midterm Test
- Second Assignment
- Third Midterm Test
Assignments (by teams of 2 or 3 students)
- Assignment 1 (Due Date: 05/28/2015 )
- Assignment 2 (Due Date: 06/11/2015)
In Class Application Exercises Solutions
- In class application exercises solutions Topic 3
- In class application exercises solutions Topic 4
- In class application exercises solutions Topic 5
- In class application exercises solutions Topic 7
Midterm_Test_1_ECON_345_Instructions
Midterm_Test_2_ECON_345_Instructions
Midterm_Test_3_ECON_345_Instructions
Review for Exams
- Review Exercises for Midterm Test 1
- Solutions to Review Exercises for Midterm Test 1
- Review Exercises for Midterm Test 2
- Solutions to Review Exercises for Midterm Test 2
- Review Exercises for Midterm Test 3
- Solutions to Review Exercises for Midterm Test 3
Course Outline and Readings
- Topic 1: Introduction: Money And The Financial System
Readings: Textbook, Ch. 1&2
- Topic 2: Financial Instruments, Markets And Institutions
Readings: Textbook, Ch.3
Exercises on Chapters 1, 2 and 3
Solutions to Exercises on Chapters 1_2_and_3
- Topic 3: Future Value, Present Value And Interest Rates
Readings: Textbook, Ch.4
Exercises on Chapter 4
Solutions to Exercises on Chapter 4
- Topic 4: Understanding Risk
Readings: Textbook, Ch.5
- Topic 5: Bonds, Bond Prices And The Determination Of Interest Rates
Readings: Textbook, Ch.6
- Topic 6: The Risk And Term Structure Of Interest Rates
Readings: Textbook, Ch.7
- Topic 7: Foreign Exchange Market
Readings: Textbook, Ch.10
- Topic 8: Tools And Conduct Of Monetary Policy
Readings: Textbook, Ch.17 (p. 370-391), &18
- Topic 9: Business Cycle Fluctuations
Readings: Textbook, Ch.19
ECON 345: Money and Banking