FI363 Financial Institutions & Markets

for F1B 2007

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FI 363 Financial Institutions and Markets


F1B 2007 BL


Williams, Cynthia


Economics Instructor


M.S. Economics
B.B.A. Economics & Finance


Semester Dates

Aug 6 - Sept 30 2007

Class Days


Class Time

7:40 - 10:10 PM


EC 301

Credit Hours



Mishkin, Frederic S.; The Economics of Money, Banking, and Financial Markets; Addison-Wesley: Boston; 8th Ed.

Textbooks can be purchased through the MBS bookstore

Additional Resources:

McAfee Memorial Library - Online information, links, electronic databases and the Online catalog. Contact the library for further assistance via email or at 800-270-4347.
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Course Description:
A study of the macrofinancial environment with emphasis on the structure, functions, and economic role of financial institutions and markets. This includes the role of commercial banks, the central banking system and international finance. PREREQUISITE: EC 301. 3:0:3

Learning Outcomes:
  Core Learning Outcomes

  1. Discuss the money supply response to changes in key variables including the reserve ratio, the nonborrowed monetary base, the discount rate, the currency ratio, expected deposit outflows, and market interest rates.
  2. Compare the Classical and Neoclassical (Monetarist) views of money demand with the Keynesian view, focusing on the role of interest rates and the debate surrounding the velocity of money.
  3. Identify the tools, goals, and targets of monetary policy.
  4. Discuss the transmissions mechanisms of monetary policy.
  5. Discuss how asymmetric information, adverse selection, and moral hazard relate to banking regulation in the U.S. and abroad.
  6. Apply macroeconomic and monetary theory to a selected real world situation.

Core Assessment:

Class Assessment:

Midterm Exam worth 100 points: 30%
Comprehensive Final Exam worth 100 points: 30%
Homework Sets (4) worth 100 points each: 40%

The student must pass the comprehensive final exam with a 60% better to pass the course.


A 90-100
B 80-89
C 70-79
D 60-69
F 50-59

All final exams will be comprehensive and will be closed book and closed notes.  If calculators are allowed, they will not be multifunctional electronic devices that include features such as: phones, cameras, instant messaging, pagers, and so forth.  Electronic Computers will not be allowed on final exams unless an exception is made by the Associate Dean.

Classroom Rules of Conduct:
Students are encouraged to read the latest edition of the Park University Catalog for policies, procedures, and rules concerning student behavior and responsibilities.

Course Topic/Dates/Assignments:

Why Study Money, Banking, and Financial Markets/Aug 6/Ch.1
An Overview of the Financial System/What Is Money?/Aug 8/Chs.2,3
Understanding Interest Rates/The Behavior of Interest Rates/Aug 13/Chs.4,5
The Risk and Term Structure of Interest Rates/Aug 15/Ch.6
The Stock Market, the Theory of Rational Expectations, and the Efficient Market Hypothesis/Banking and the Management of Financial Institutions/Aug 20/Chs.7,9
Review Midterm Exam/Aug 22
Midterm Exam/Aug 27/Homework Sets #1-3
Banking Industry: Structure and Competition/Structure of Central Banks and the Federal Reserve/Aug 29/Chs.10,14
Multiple Deposit Creation and the Money Supply Process/Determinants of the Money Supply/Sept 3/Chs.15,16
Tools of Monetary Policy/What Should Central Banks Do?Monetary Policy Goals, Strategy, and Tactics/Sept 5/Chs.15,16
The Demand for Money/Sept 10/Ch.19
The ISLM Model/Sept 12/Chs.20
Monetary and Fiscal Policy in the ISLM Model/Sept 17/Ch.21
Aggregate Demand and Supply Analysis/Transmission Mechanisms of Monetary Policy: The Evidence/Sept 19/Chs.22,23
Review Final Exam/Sept 24
Final Exam/Sept 26/Homework Sets #4,5

Academic Honesty:
Academic integrity is the foundation of the academic community. Because each student has the primary responsibility for being academically honest, students are advised to read and understand all sections of this policy relating to standards of conduct and academic life.   Park University 2006-2007 Undergraduate Catalog Page 87-89

Plagiarism involves the use of quotations without quotation marks, the use of quotations without indication of the source, the use of another's idea without acknowledging the source, the submission of a paper, laboratory report, project, or class assignment (any portion of such) prepared by another person, or incorrect paraphrasing. Park University 2006-2007 Undergraduate Catalog Page 87

Attendance Policy:
Instructors are required to maintain attendance records and to report absences via the online attendance reporting system.

  1. The instructor may excuse absences for valid reasons, but missed work must be made up within the semester/term of enrollment.
  2. Work missed through unexcused absences must also be made up within the semester/term of enrollment, but unexcused absences may carry further penalties.
  3. In the event of two consecutive weeks of unexcused absences in a semester/term of enrollment, the student will be administratively withdrawn, resulting in a grade of "W".
  4. A "Contract for Incomplete" will not be issued to a student who has unexcused or excessive absences recorded for a course.
  5. Students receiving Military Tuition Assistance or Veterans Administration educational benefits must not exceed three unexcused absences in the semester/term of enrollment. Excessive absences will be reported to the appropriate agency and may result in a monetary penalty to the student.
  6. Report of a "F" grade (attendance or academic) resulting from excessive absence for those students who are receiving financial assistance from agencies not mentioned in item 5 above will be reported to the appropriate agency.

Park University 2006-2007 Undergraduate Catalog Page 89-90

Disability Guidelines:
Park University is committed to meeting the needs of all students that meet the criteria for special assistance. These guidelines are designed to supply directions to students concerning the information necessary to accomplish this goal. It is Park University's policy to comply fully with federal and state law, including Section 504 of the Rehabilitation Act of 1973 and the Americans with Disabilities Act of 1990, regarding students with disabilities. In the case of any inconsistency between these guidelines and federal and/or state law, the provisions of the law will apply. Additional information concerning Park University's policies and procedures related to disability can be found on the Park University web page: .


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Last Updated:6/21/2007 10:57:46 AM