Monetary theory and policy
Dr Kaludura Abayasiri-Silva
6 points * Distance * First semester * Prerequisites: DEB1710 and DEB2710
Objectives On successful completion of this course students should be able to use an analytical framework to evaluate the role of monetary policy in macroeconomic policy at an intermediate level; understand the inpact of a floating exchange rate on the effectiveness of monetary policy; understand the role of the Reserve Bank in the implementation of monetary policy.
Synopsis A review of the Keynesian model of output and employment determination; the development of an analytical framework as the basic tools for analysis of the macroeconomic inpact of monetary policy; implementation of monetary policy by the Reserve Bank; the relationship between inflation and unemployment; the role of the balance of payments and the exchange rate in the evaluation of monetary policy; the interaction between the money market, the market for goods and services and the labour market; the optimal mix of monetary and fiscal policy.
Assessment Assignment (2000 words): 30% * Examination (2 hours): 70%