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Solution manual for money banking financial markets institutions 2nd Edition for Brandl Michael.pdf
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Solution manual for money banking financial markets institutions 2nd Edition for Brandl M
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SOLUTION MANUALMoney, Banking, Financial Markets & Institutions
2nd Edition for Brandl Michael, All Chapters 1 - 24
,TABLEyOFyCONTENTS
PartyI:yMONEYyANDyITSyPRICES.
1. IntroductionyandyOverview.
2. Money,yMoneyySupplyyandyInterest.
3. Bonds,yLoanableyFundsy&yInterestyRates.yy4.yI
nterestyRatesyinyMoreyDetail.
Part II: MONEY AND OVERALL ECONOMY.
5. FinancialyMarketsythroughyTime.
6. AggregateySupplyy&yAggregateyDemand.yy7.y
BanksyandyMoney.
PartyIII:yCENTRALyBANKS.
8. CentralyBanks.
9. MonetaryyPolicyyTools.
10. TheyMoneyySupplyyProcess.yy11
.yMonetaryyPolicyy&yDebates.y PartyI
V:yTHEyBANKINGySYSTEM.
12. BankyManagement.
13. BankyRiskyManagementy&yPerformance.yy14.y
BankingyRegulation.
PartyV:yFINANCIALyMARKETS.
15.yMoneyyMarkets.yy16.y
BondyMarkets.
17.yStockyMarkety&yEfficiency.yy18.yM
ortgageyMarket.
PartyVI:yGLOBALyFINANCIALyMARKETS.yy19.yF
X.
20. GlobalyFinancialyArchitecture.y Party
VII:yFINANCIALyINSTITUTIONS.
21. ThriftsyandyFinanceyCompanies.yy22.
yInsuranceyandyPensions.
23. MutualyFunds.
24. InvestmentyBanksyandyPrivateyEquity.
, CHAPTERy2:yMoney,yMoneyySupply,yandyInterest
2-1 SectionyReview
1.Whatyisytheydifferenceybetweenymoneyyandycurrency?yWhenyareytheyytheysame?
yWhyymightytheyy bedifferent?
ANS:yMoneyyisyanythingygenerallyyacceptedyinyexchangeyforygoodsy&yservices.yCu
rrencyyisyissuedybyy aybankyorytheygovernment,ybutycurrencyyisynotynecessarilyymone
y.yTheyyareytheysameywhenytheyyarey acceptedyinyexchangeyforygoodsyandyservices
.yCurrenciesycanystopybeingymoneyyifypeopleydon’ty acceptthemyinyexchangeyforygo
odsyandyservices.yIfyaygroupyofypeopleystopyusingycurrencyytoygety goodsyandyservic
esybutyinsteadyuseybananas,ythenytheybananasyareytheymoney.
2. Howymanyypricesymustyaybarteryeconomyyhaveyifytheyeconomyyhasyfourygood
s?yWhatyifyityhasy 400goods?yExplainywhyyhavingyaymoneyyinytheysecondycaseyisy
beneficial.
ANS:y4ygoodsy=y6yprices;y400ygoodsy=y79,800yprices.yMoneyyallowsyusytoyspeciali
zeyandyreduceyoury searchcost.y Moneyyallowsyusytoyreduceytheynumberyofystatedypri
cesyweyneed.
3. Youyreadyaynewsystoryyaboutyaycountryythatyisysufferingyfromyrapid,yongoingyincr
easesyinytheycosty ofliving.yWhichycharacteristicyofymoneyyisybeingydirectlyynegative
lyyimpactedyinythatyeconomy?
a. Unityofyaccount
b. Mediumyofyexchange
c. Storeyofyvalue
d. Doubleycoincidenc
eyofy wantsANS:yC
2-2 SectionyReview
1. Bobbyyisyconfused.yHeystates:y“Sinceyprisonersyareynotyallowedytoysmokeyinyprisonsy
anyylonger,y Radford’syyexamplesyyofy cigarettesy iny POWy campsy noy longery applies
.”y Howy wouldy youy explainy toy BobbyyhowyyRadford’sy storyyydemonstratesyytheyycon
ceptsyyofyy theyycriteriayyofyymoney,yyasyywelly asyythey importanceyofchangesyinytheymone
yysupply?
, ANS:yAnyyassetythatyisyableytoybeystandardized,ydivisible,ydurableyandyinydemandyco
uldybeycurrency,yasy longy asy ity isy ay mediumy ofy exchange,y isy ay unity ofy accounty andy h
asy storey ofy value.y Cigarettesy werey money.
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