Course Outline

Course Outline for Spring 2015-16 Semester

EASTERN MEDITERRANEAN UNIVERSITY
FACULTY OF BUSINESS AND ECONOMICS
DEPARTMENT OF BANKING AND FINANCE

2018-2019 SPRING SEMESTER

COURSE CODE

FINA 302

COURSE LEVEL

6th semester 3rd year - Undergraduate

COURSE TITLE

Money and Banking

COURSE TYPE

Area Core

LECTURER(S)

Assoc. Prof.Dr.Hasan Altiok

CREDIT VALUE

3 Credit Hrs.

ECTS VALUE

6

PREREQUISITES

None

COREQUISITES

None

DURATION OF COURSE

One Semester

WEB LINK

http://bank.emu.edu.tr

http://fbemoodle.emu.edu.tr

CATALOGUE DESCRIPTION This course presents the students underlying economic explanations for why the financial system is organized as it is and to teach them functions of the financial system in the economy. It focuses on the role of interest rates, financial markets and institutions.

 

AIMS & OBJECTIVES The aim of this course is to teach students the evolution of monetary economics and the role of the money in the economic transactions. It also tries to explain interest rate determination and the relationship between interest rates and term structure. Understanding the role of financial institutions in asymmetric information, transaction cost, adverse selection, moral hazard and market efficiency are also among the objectives of the course.

 

GENERAL LEARNING OUTCOMES (COMPETENCES)

On successful completion of this course, all students will have developed knowledge and understanding of:

-       The role of financial system in the economy

-       Interest rate determination

-       Financial markets

-       Financial Institutions

On successful completion of this course, all students will have developed their skills in:

-       Understanding the risk sharing, information and liquidity services of the financial system

-       Analysing interest rate movements

-       Understanding the role of financial institutions and markets in economy

On successful completion of this course, all students will have developed their appreciation of and respect for values and attitudes regarding the issues of:

-       Need for the efficient financial system

-       Role of financial institutions and markets

-       Money and Interest rates

 

GRADING CRITERIA

85 – 100 (A); 80 – 84 (A-); 75 – 79 (B+); 70 – 74 (B); 66 – 69 (B-); 63 – 65 (C+); 60 – 62 (C); 57 – 59 (C-); 54 – 56 (D+); 50 – 53 (D); 45 – 49 (D- /FAIL); 0  - 44 (F/FAIL)

 

RELATIONSHIP WITH OTHER COURSES

Since the course involve with monetary issues it is very closely related to macroeconomics.

 

LEARNING / TEACHING METHOD

Lectures, assignments and quizzes

 

ASSIGNMENTS

Assignments are given to develop analytical thinking of students and are designed to develop practical knowledge in concepts of Money, Banking and Financial Markets. They are tools of learning more than tools of assessment. 

GUIDELINES FOR ASSIGNMENTS:     

Homework should be clearly written with a pencil or pen (red reserved for correction) on an A-4 white paper, with a cover page and in a plastic folder file. They should be in a form that would be acceptable to your future employer.  Sloppy work will not be accepted.

 

Late assignments will not be accepted for initial credit unless you have an authorized written excuse.  Late assignments within acceptable dates will be graded with a 20% discount. No homework can be accepted after the return of corrected homework.

 

METHOD OF ASSESSMENT

          Quizzes                                                     20%

          Midterm Exam                                          35%

          Final Exam                                                45%

 

ATTENDANCE

Attendance is compulsory by school regulations. Students are strongly advised not to miss lecture hours since success is closely related with attendance. Absence over 20% will be penalized with an NG.

 

MAIN TEXTBOOK

Schoenholtz, Cecchetti. Money, Banking, and Financial Markets, Third Edition, Mc Graw Hill.

 

ADDITIONAL TEXTBOOK/S-

Hubbard, Glenn R., Money, the Financial System, and the Economy, Sixth Edition, Addison Wesley, 2008.

INDICATIVE BASIC READING LIST

None

EXTENDED READING LIST

None

SEMESTER OFFERRED

2015-2016 Spring Semester

CONTENT & SCHEDULE

Please check your own course time table

 

PLAGIARISM

This is intentionally failing to give credit to sources used in writing regardless of whether they are published or unpublished. Individual work must reflect an individual’s own effort. Do not copy from others. Academic dishonesty carries a penalty that may range from receiving a grade of zero to expulsion from the University. Plagiarism (which also includes any kind of cheating in exams) is an offence and will be dealt with according to University regulations.

 

MAKE-UP EXAMS

Students, who have valid excuses, will be allowed to take make-up examinations for midterm and final exams. No make-up exams for quizzes.

 

 

 

 

THE LECTURE TOPICS WITHIN THE SEMESTER ARE AS

IN THE FOLLOWING SCHEDULE

 

WEEK

SUBJECT & CHAPTER

TOPICS

1

Chp.1: An Introduction to Money and the Financial System 

Financial system and the economy; Financial markets; Financial institutions; Economic analysis as a tool.

2

Chp.2: Money and the

Payment System

Quiz 1

Money vs. barter; what can serve as money; the payment system; Measuring the money supply.

3

Chp.3: Financial Instruments, Financial Markets, and Financial Institutions 

The purpose of the financial system; Risk sharing; Liquidity; Information; Debt and equity; Savers and borrowers.

4

Chp.4: Future Value, Present Value, and Interest Rates

Comparing debt instruments; Present value; Yield to maturity; Bond yields and prices.

5

Chp.4: Future Value, Present Value, and Interest Rates

Comparing debt instruments; Present value; Yield to maturity; Bond yields and prices.

6

Chp.5: Understanding Risk

Quiz 2

Definition of Risk, measuring risk, sources of risk; idiosyncratic and systematic risk. Reducing risk through diversification.

7

Chp.6: Bonds, Bond Prices, and the Determination of Interest Rates

Supply and demand in the bond market and loanable funds.

8

MIDTERM EXAMINATIONS

9

Chp.6: Bonds, Bond Prices, and the Determination of Interest Rates

Explaining changes in equilibrium interest rates; International capital market and the interest rates.

10

Chp.7: Risk and Term Structure of Interest Rates   

Default risk; liquidity; Information costs; Taxation; Segmented market hypothesis; Expectations theory; Preferred habitat approach.

11

Chp.7: Risk and Term Structure of Interest Rates   

Quiz 3

Default risk; liquidity; Information costs; Taxation; Segmented market hypothesis; Expectations theory; Preferred habitat approach.

12

Chp.11:The Economics of Financial Intermediation   

The role of financial intermediaries, solving the adverse selection problem. Moral Hazard: Problem and Solutions. Financial intermediaries and information costs

13

Chp.14: Regulating the Financial System

The sources and consequences of runs, panics, and crises. Regulation and supervision of the financial system.

 

14

 

 

Review and end of classes

15

FINAL EXAMINATIONS

Last modified: Tuesday, 19 February 2019, 10:33 AM