Includes bibliographical references and index.

Contents: Introduction -- Why study money, banking, and financial markets? -- An Overview of the financial system -- What is money? -- Financial markets -- Understanding interest rates -- The Behavior of interest rates -- The Risk and term structure of interest rates -- The Stock market, the theory of rational expectations, and the efficient market hypothesis -- Financial Institutions: An Economic analysis of financial structure -- Banking and the management of financial institutions -- Banking industry: Structure and competition -- Economic analysis of banking regulation -- Central banking and the conduct of monetary policy: Structure of Central Banks and the Federal Reserve System -- Multiple deposit creation and the money supply process -- Determinants of the money supply -- Tools of monetary policy -- What should Central Banks do? monetary policy goals, strategy and tactics -- International finance and monetary policy: The Foreign exchange market -- The International financial system -- Monetary policy: The Demand for money -- The ISLM model -- Monetary and fiscal policy in the ISLM model -- Aggregate demand and supply analysis -- Transmission mechanisms of monetary policy: the evidence -- Money and inflation -- Rational expectations: implications for policy.