UNIVERSITY OF MARYLAND
DEPARTMENT OF ECONOMICS
ECONOMICS 330
Spring Semester, 2018 Dr. John Neri
Room: TYD 0130 Office: Morrill Hall-1106D
Lecture: T and Th 9:30am to 10:45am E-mail:
Office Hours: T and Th 3:30pm - 4:30pm (Use this e-mail, not ELMS)
REQUIRED
Mishkin, Frederic S. Money, Banking, and Financial Markets, Business School 4th Edition, Pearson Addison-Wesley. ISBN: 9780134047416. 3rd edition is fine.
Please note: Pearson MyEconLab is required for this course. Students who purchase a used textbook will need to purchase MyEconLab as well.
COURSE DESCRIPTION
Economics 330 is a course in money, banking and financial markets. The objective of this course is to develop a clear understanding of (i) the determination of interest rates; (ii) interactions between different financial institutions; (iii) the role money, banks and the Federal Reserve in the American financial system. At the end of this course you will be conversant in the language of financial markets and institutions, and have an understanding of: (1) what money is and why we use it; (2) the fundamental concepts of a financial instrument, including bonds, stocks, derivatives; (3) the basic purpose of financial markets; (4) the role of financial institutions in our economy, with a special emphasis on banks; and (5) the importance of central banks and the conduct of monetary policy.
Pre-Requisite: Minimum grade of C- in ECON200 and ECON201
COURSE WEB SITE: http://www.terpconnect.umd.edu/~jneri/Econ330 The “E” in Econ330 is capitalized.
EXAMINATIONS, PROBLEM SETS AND GRADES
Your grade will be determined as follows:
· Two (2) midterm exams 200 points (100 points each)
· Comprehensive Final Exam 140 points
· Six (6) problem sets 60 points (10 points each)
· 12 MyEconLab Homework Assignments 60 points (5 points each)
Total 460 points
The two midterm exams (43 percent of your grade) will be a combination of multiple-choice, short answer/problems. The final exam (30 percent of your grade) is all multiple-choice. The multiple-choice section will be taken on a computer-grading sheet (scantron sheet) with a number 2 pencil. I will also assign 6 graded problem sets (13 percent of your grade). We will attempt to return the graded short answer portion of the exams and the problem sets one week after the due date. Graded written portion of the exam and problem sets will be placed on the shelf outside Morrill Hall1106D. We will post the grades to ELMS and you will be notified by e-mail. You will have one-week after grades are posted on ELMS to raise questions regarding your grade on the exams and the 6 written problem sets. I will not entertain any grade questions after the one week question period. All mid-term exams and problems set that are not picked up 2 weeks after the grades are posted will be discarded.
Students with total points less than or equal to 230 (50 percent) will receive a grade of “F” for the course. I’ve taught this course many times. Students that get A’s and B’s in this course attend lecture regularly. If you do not plan on attend lecture, you will not do well in this course. I will assign +/- grades. More in class.
WRITE YOUR NAME IN INK on your problem sets and exams. Unfortunately we have had names in pencil erased and a new name inserted. Hard to believe, but true.
MyEconLab (MEL): The text comes with MyEconLab which contains the e-book version of the text, on-line study modules and on-line homework. In addition to the 3 exams, you are required to complete 12 MyEconLab (MEL) Assignments. I will assign 14 and count the 12 highest scores in the final grade. There will be no make-ups for the MyEconLab (MEL) homework assignments.
LECTURE ATTENDANCE
Lectures are on Tuesday and Thursday from 9:30am to 10:45am. I expect you to come to class and remain in class for the duration of the class period. The course web page http://terpconnect.umd.edu/~jneri/Econ201/ is provided to update and disseminate course information. I post very detailed lecture slides (PPT and Pdf) for you to bring to class as an aid following lectures. The slides are not intended to be a substitute for attending class. Students that perform very well in this course go through the lecture slides before class noting topics or concepts that are not clear and fill in gaps in lecture. This is a good approach which I strongly encourage you to follow. Any topic discussed in lecture is “fair game” for the exams. Private conversations are disruptive and rude to fellow students and your instructor and will not be tolerated.
TEACHING ASSISTANTS: Seul A Kim is the graduate teaching Assistant (TA) for this course. I will update her office location, office hours and e-mail address on the course web site.
MAKE-UP EXAMINATION POLICY
Make-up Policy: You are required to take all examinations. Makeup exams andextended deadlines forassignments willonlybe given in cases of excused absences, and official documentation is required. Exams andALLassignments are deemed Major Scheduled Graded Events, and therefore according to the new University excused absence policy, student-signed honor statements attesting to illness do not apply. (You do not need to inform me if you will miss one class due to illness.) Excused absences are: illness, death in the immediate family, religious observances, required school activities, and required court appearances. Again, official documentation is required for all excused absences, including religious observances which are part of the new policy. I will not accept a Health Center honor statement to verify an illness. If you go to the Health Center and a doctor will not write you a note that means they consider you well enough to continue with academic activities.
For the policies to be followed in this course on absences from examinations, make-up exams please see UNIVERSITY OF MARYLAND POLICY ON EXCUSED ABSENCE
http://www.president.umd.edu/sites/president.umd.edu/files/documents/policies/V-1.00G.pdf
You will need to present a valid University excuse to me within 24 hours of the scheduled exam in order to take the make-up.
CALCULATORS
You may not use a programmable calculator for exams. A good calculator for this course and many other courses is a TI-30X scientific calculator (cost about $15.00). I am not able to provide calculators for exams.
APPROXIMATE SCHEDULE (Exam dates may slide and order of presentation may change)
Additional required reading and videos will be posted on the course web site.
Class Dates I. Course Introduction, Financial Markets and Risk
(1/25) Introduction to Course and Overview of the Financial System - Chapters 1 and 2
(1/30, 2/1) Overview of the Financial System - Chapters 2 and 8 (Week 2: MEL 1 due Sun. 2/4)
(2/6, 2/8) Money and Risk - Chapter 3 and Lecture Slides on Risk. (Week 3: MEL 2 due 2/11)
II. Financial Markets and Interest Rates
(2/13, 2/15) Understanding Interest Rates - Chapter 4. (Week 4: MEL 3 due Sun. 2/18)
(2/20, 2/22) Behavior of Interest Rates - Chapter 5(Week 5: MEL 4 due Sun. 2/25)
(2/27, 3/1) Risk and Term Structure of Interest rates - Chapter 6 (Week 6: MEL 5 due Sun. 3/4)
Exam 1 – Tentatively Tuesday March 6
III. Commercial Banking
(3/6, 3/8) Commercial Banks and How Banks Manage Their Balance Sheet – Chapter 9
(Week 7: MEL 6 due Sun. 3/11)
(3/13, 3/15) Commercial Banks and Non-Bank Finance – Chapter 9 and Chapter 13 (Week 8: MEL
7 due Sun. 3/18)
(3/20, 3/22) SPRING BREAK
IV. Central Banks and Monetary Policy
(3/27, 3/29) Central Banks and the Federal Reserve System - Chapters 16 (Week 9: MEL 8 due on
Sun. 4/1)
(4/3, 4/5) The Money Supply Process - Chapter 17 (Week 10: MEL 9 due on Sun. 4/8)
(4/10, 4/12) Tools of Monetary Policy and What Central Banks Should Do - Chapters 18 and 19
(Week 11: MEL 10 due on Sun. 4/15)
Exam 2 – Tentatively Tuesday April 17
(4/17, 4/19) Finish Conduct of Monetary Policy – Chapter 19 (Week 12: MEL 11 due on Sun. 4/22)
(4/24, 4/26) Quantity Theory of Money, Monetary Policy Theory, and Transmission – Chapters 22
and 25 (Week 13: MEL 12 due on Sun. 4/29)
(5/1, 5/3) Economics of Financial Regulation – Chapter 10 (Week 14: MEL 13 Sun. 5/6)
(5/8, 5/10) TBA (Week 15: MEL 14 due on Sun. 5/11)
Final Examination – Monday May 14 from 8:00a.m.- 10:00 a.m.
Exam locations to be announced.
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