BA 4345 Money and Capital Markets Fall 2005

Instructor: Mary Chaffin M 7-9:45 p.m.

chaf@utdallas.edu
Office: SM2.208
Office Hours: Monday 3:30-6:00 p.m. and by appointment
Web page: www.utdallas.edu/~chaf

Required Text: Principles of Money, Banking, & Financial Markets, 11th Ed., by Ritter, Silber, Udell
Recommended: Financial Calculator, Wall Street Journal(Available in the library if you do not subscribe)

Course Description:
This course focuses on money, financial markets and institutions. The objectives are: to provide a
perspective on how financial markets and institutions fit in to the economy; to help you understand the
importance of money, credit, and interest rates; to describe the function of various financial markets -
money markets, capital markets, foreign exchange markets, derivatives markets, and their numerous
financial instruments; to provide a perspective on the business of financial institutions such as
comme rcial/investment banks, investment funds and their regulation; to help you understand the Federal
Reserve System and how it impacts monetary policy.

Major Topics:
Overview of Financial Markets and Institutions
Determinants of Interest Rates
The Securities Markets – Money, Bond, Mortgage, Stock, Foreign Exchange and Derivative Markets
Depository Institutions – Commercial Banks and Thrifts
Non-depository Financial Institutions
The Federal Reserve System, Monetary Policy and Interest Rates

Course requirements and Prerequisites:

You should have successfully completed BA 3341 Business Finance. You are expected to have proficiency
in time value of money concepts and calculations, spreadsheet modeling and Internet skills.

Course Materials:
Student lecture notes are available on Web CT. Students are responsible for assignments and assigned
reading materials. Come to class prepared to discuss. Answers to the end of chapter questions are
available on Web CT.

Course Grading:
You must take exams on the dates and times given. Students missing an exam will be required to take a
comprehensive final exam. Each exam will last approximately one hour and will be problems and short
answer. The final exam will last two hours and will be multiple -choice.
• A student that takes all four exams has the option to take the final exam but is not required to
take the final.
• For students that take all four exams and do not take the final exam, each exam will count
25%.
• For students that take all four exams and choose to take the final exam, the top four grades
will count 25%.
• For students that are required to take the final exam, each exam including the final will count
25% of the student’s grade.
Grades will be based on the following scale:
97+ = A+, 93-96.99 A, 90-92.99 A -. The breakdown is the same for other grades.
Extra Credit:
An extra credit assignment is available on Web CT. This is ten assignments to be done throughout the
semester. All exercises must be done to receive any extra credit. If your submission is complete and of
high quality, I will add up to 3 points to your final average. A hard copy of the ten problems is due
between November 21 and November 28 at 7:00 p.m. NO ASSIGNMENT WILL BE ACCEPTED
LATE. The date on the assignment is the recommended date to do the assignment. I will answer
questions about the assignment up until 2 days after that date. Data on the Internet may change. If you are
doing the assignments after the date indicated and the data is not available, you are responsible for finding
the data elsewhere if you wish to complete the assignment. The assignments are designed to increase
understanding of some of the concepts covered in class.

I will randomly call on students during class. Being in attendance and prepared can add up to one point on
your final course grade.

Text Web Page:

If you purchased a new copy of the text book, additional resources are available online at
www.myeconlab.com . The course ID is: chaffin72401.

Practice Problems:
Practice problem sets are available on Web CT. These should be done prior to each of the exams . We will
go over these in class upon request. They are not to be turned in.

Readings:
Periodically articles from the Wall Street Journal or other publications will be posted on Web CT. You are
responsible for reading the articles. Test questions may come from the articles.

Class Schedule:
August 22 Ch 1, 2, 3 Introduction
August 29 Ch 4, 5 Determinants of Interest Rates
September 12 Ch 5, 6 Interest Rates and Security Valuation
Exam 1 (2,3,4,5)
September 19 Ch 8 Money and Capital Markets
September 26 Ch 9 Derivative Markets
October 3 Ch 10 Foreign Exchange Markets
October 10 Ch 11, 12 Depository Financial Institutions
Exam 2 (6,8,9,10)
October 17 Ch 12, 13 Non-depository Financial Institutions
October 24 Ch 13, 14 Financial Contracts
November 7 Ch 15, 17 The Federal Reserve System
Exam 3 (11,12,13,14)
November 14 Ch 18 The Central Bank and the Money Supply
November 21 Ch 19 The Instruments of Central Banking
November 28 Ch 29 Economic Indicators
Exam 4 (15,17,18,19)
December 5 Final Exam (Optional if you have taken all other exams) – Bring Scantron

Policy on Cheating: Students are expected to be above reproach in all scholastic activities. Students who
engage in scholastic dishonesty are subject to disciplinary penalties, including the possibility of failure in
the course and dismissal from the university. "Scholastic dishonesty includes but is not limited to cheating,
plagiarism, collusion, the submission for credit of any work or materials that are attributable in whole or in
part to another person, taking an examination for another person, any act designed to give unfair advantage
to a student or the attempt to commit such acts." Regents' Rules and Regulations, Part One, Chapter VI,
Section 3, Subsection 3.2, Subdivision 3.22. Violations of class rules will subject you to discipline from
the Dean of Students. I take scholastic dishonesty very seriously.