Authorised by Academic Registrar, April 1996
Objectives On the completion of this subject students should have developed a sound theoretical background in understanding the important role played by financial markets in the operation of a modern monetary economy; a conceptual and practical understanding of the economic and regulatory framework of the financial markets and the optimising behaviour of economic agents in making funding decisions in financial markets.
Synopsis Topics include an introduction to money and monetary economy; economic analysis of financial markets; money market institutions and their role in the monetary economy; money and money supply process; the demand for money; the role of money markets in macroeconomic models; short-term money market and implementation of monetary policy in Australia; determination of interest rates and their term structure; the effect of economic news and policy announcements on financial markets; monetary policy under deregulated financial markets.
Assessment Research assignment: 30% + Examination (2.5 hours): 70%