The course provides an introduction to financial markets and the assets traded therein (such as bonds, stocks, and derivatives), with an emphasis on the role and function of commercial banks. This is complemented with analysis of the money market. Theories of money demand are combined with discussion of the role of the banking system in the money supply process. We examine the central role of the Federal Reserve in executing monetary and credit policies. The course incorporates econometric techniques and spreadsheets in analyzing financial data and makes use of some standard data sources. This course is offered in the fall semester, 2010.
Prerequisites: Economics 292 and 253; or consent of the instructor.