# Economics 330 - Money & Banking

Fall 2021

**Professor:** Steve Rick

**Lecture:** TuesThurs 9:30-10:45 AM

Ingraham 22

Course Canvas Page

**TA:** Gary Baker (he/him)

**Office:** Soc Sci 6470

**Office Hours**

Mon 1-2PM (Zoom, see Canvas for info)

Wed 2-3PM (Soc Sci 6470)

or by appointment

**Discussion Sections**

(301)Fri 9:55-10:45AM - Humanities 2221

(302)Fri 11:00-11:50AM - Soc Sci 4322

(303)Fri 12:05-12:55PM - Van Vleck B235

(304)Fri 1:20-2:10PM - Ingraham 225

**Exams**

Exam 1 - Tues, 12 Oct (in class)

Exam 2 - Tues, 16 Nov (in class)

Final - Wed, 22 Dec (10:05AM - 12:05PM**

**Discussion Handouts**

Handout 1
(Solutions)

Handout 2
(Solutions)

Handout 3
(Solutions)

Handout 4
(Solutions)

handout 5
(Solutions)

handout 6
(Solutions)

handout 7
(Solutions)

handout 8
(Solutions)

handout 9
(Solutions)

handout 10
(Solutions)

**Other materials**

Yield to maturity vs rate of return

Geometric sums and yield to maturity

Compound interest

Expectations theory

Gap and duration analysis

Welcome to Econ 330 for Fall 2021. Throughout the semester, I’ll post discussion handouts and other updates as necessary.

## Updates

*9 September:* No discussion sections this week (10 September). First discussions will be Friday, 17 September.
Homework 1 (Ch. 2 of Mishkin, Qs 1, 3, 6, 9, 10, 12, 15, 17, and 22) is due *at the start of section* next Friday (17 Sept).

*28 September:* Homework can now be submitted via Canvas in case you can’t make it to section (submitting in section is still recommended**. Please still handwrite your answers. Canvas submissions will close at 3PM on Fridays.

I’ve also uploaded short handwritten notes on how to use the geometric series equations to simplify some of the present-value/yield-to-maturity equations, the difference between yield to maturity and rate of return, and how interest rates work when payments occur more frequently than once a year.

*5 October:* I’ve added a short note on why under expectations theory the long-term interest rates would be equal to the (arithmetic) average of the expected short-term rates over the holding period.
Midterm 1 is coming up fast, so make sure to review the readings, homework solutions, and lecture notes.

*14 October:* Raw exam scores are now on Canvas. Grades assignments for the exam are:

- A: 86-100
- AB: 78-85
- B: 72-77
- BC: 62-71
- C: 56-61
- D: 46-55
- F: 0-45

*21 October:* My Wednesday office hours going forward will be in the afternoon from 2 to 3PM.

*1 November* Because I wasn’t able to cover duration analysis in discussions, I’ve uploaded a new handwritten note covering both gap and duration analysis. In short, you can use gap analysis to estimate changes in profits (flows) from interest rate changes, while you can use duration analysis to estimate changes in values (stock).

*18 November* Second midterm scores are on Canvas. The curve is as follows:

- A: 92-100
- AB: 86-91
- BC: 74-77
- C: 64-73
- D: 51-63
- F: 0-50