Description

This unit is concerned with the role of money in the economy; integration of monetary and value theory; rational expectations; money supply process; monetary implications when reserve requirement is zero; optimum supply of money; demand for money; financial model building; theory of interest rates; term structure of interest rates; Ricardian equivalence; credit rationing.

Topics

• Role of money in the economy
• Rational expectations and monetary theory
• Money supply process
• Optimum money supply
• Demand for money
• Financial model building
• Theory of interest rates
• Term structure of interest rates
• Ricardian equivalence
• Credit rationing