National University of Sciences and Technology

School of Social Sciences & Humanities (S3H)

Islamabad
Course Title: Monetary Theory
Course Code: Econ- 315
Class:
BS Economics 2K12
Semester:
5th (Fall 2014)
Instructor: Saeeda Batool
______________________________________________________________________________
Course Objectives:
This course will develop theoretical knowledge about monetary sector of the economy including
the working of financial institutions and the impact of their policy actions on the economy.
Course Outcomes: After completion of course, students shall be able to understand:

the theoretical foundations of monetary sector of the economy

the working and importance of monetary institutions channels
the nature and functions of money
the role of money in monetary policy actions within Classical, Keynesian and modern
theoretical frameworks.

Course Outline
W
ee
k

Topics

Money in
Macroeconomics

An Overview of the Financ

ial System
Functions of Money

3
4

Understanding Interest Rat

es

The Behavior of Interest R

ates

The Risk and Term Structu

re of Interest Rates

An Economic Analysis of
Financial Structure
Financial Crises

8
9
10
11
12

13

Banking and the Managem

ent of Financial Institution
s
Economic Analysis of Fina
ncial Regulation
Banking Industry: Structur
e and Competition
(financial innovation)
Structure of
Central Banks and the Fed
eral Reserve System
Multiple Deposit Creation
and
The Money Supply Proces
s
The Demand for Money.

14
The ISLM Model
15

Text BOOK:
The Economics of Money, Banking and Financial Markets Frederic S. Mishkin 10TH
Edition
Recommended Reading:
1

2
3
4
5

Modern Money and Banking, 3/e, R.L. Miller and D.D. VanHoose, Mc Graw Hill, Inc.,
(1993).
Monetary Economics, G.E.J. Dennis, Harlow Essex: Longman Group Limited, (1981).
The Demand for Money Revisited, Stephen Goldfeld; Brookings Papers on Economic
Activity
Monetary Economics , Mervyn K Lewis and Paul D Mizen, Oxford University Press,
(2000).

Grade Policy
Class Participation & Assignments

10%

Quizzes

15%

Mid term Exam

25%

Final Exam

50%

Total Marks

100%