web page: oak.ucc.nau.edu/dlf/ e-mail: dennis.foster@nau.edu
The W.A. Franke College of Business
NORTHERN ARIZONA UNIVERSITY
Spring 2015 – 3 credit hours
Dr. Dennis Foster
523-8178, FCB #308
Office Hours – Wednesday, 1:00-5:00 pm;
and by appointment.
Seq. #1570 (sec. #2)
Tue/Thur 2:20 pm – 3:35 pm
Room #437 - FCB
I. Description: History and functions of money and banking institutions; financial markets and interest rates; monetary theory and policy; and international finance. The course provides further depth and extension of many of the topics included in Principles of Macroeconomics, including aggregate supply and demand, national income and output determination, business cycles, monetary policy, international trade and finance, and the role of money in open and closed economies. It assumes that a student has already acquired a familiarity with the basic concepts of these topics.
II. Prerequisites: ECO 285 and Junior Status.
III. Course Learning Outcomes: Upon successful completion of the course, students should be able to:
A.
Describe the role of money and financial markets, institutions, and instruments in a market economy.
B.
Explain the interrelationships between money, inflation, and interest rates.
C.
Demonstrate how supply and demand analysis in graphical form can be applied to loanable funds markets.
D.
Explain the time value of money and demonstrate an ability to calculate the values of various financial assets.
E.
Explain and evaluate the competing theories underlying the term structure of interest rates.
F.
Describe the function of foreign exchange markets and explain their operation using supply and demand analysis.
G.
Describe the history, modern structure, and policy tools of the Federal Reserve System.
H.
Explain in a historical context the development of our current view of the demand for money and how it relates to the supply of money.
I.
Explain the classical, Keynesian, and monetarist macroeconomic monetary theories.
Syllabus – ECO 473 (2) – Spring 2015 - Foster Page 1

IV. Course Materials: Materials for this course include the following:
M&B
Money and Banking available without author attribution on-line from The Saylor
Foundation: http://www.saylor.org/site/textbooks/Money%20and%20Banking.pdf
Roth; R
Smiley
Woods; W
The Mystery of Banking by Murray Rothbard (Mises Institute, 2 nd edition, 2008)
ISBN: 978-1-933550-28-2, or available on-line as a pdf file: http://mises.org/sites/default/files/Mystery%20of%20Banking_2.pdf
Rethinking the Great Depression by Gene Smiley; (Ivan R. Dee, 2002)
ISBN-10: 1-56663-471-7
Meltdown by Thomas E. Woods, Jr. (Regnery, 2009) ISBN-10: 1596985879
V. Teaching Methods: Primary teaching methods for this course include class lecture, class discussion and assignments. Also, the use of current technologies will be expected of students.
Learning Process: Each student must take personal responsibility for learning the material presented in this course. Successful students have two common traits that I have observed--a 100% commitment to the class and active study habits. Read and review the assigned material before the lecture. Feel free to consult with me any time regarding your progress in class.
VI. Evaluation Tools: Evaluation inputs will include the use of in-class quizzes and multiple exams. The majority of your letter grade will be the result of test scores. Your final letter grade will be based on your performance as follows:
 4 midterm exams @ 100 pts.
 10 of 12 weekly assign. @ 10 pts.
 1
= 400
= 100
= 200
 Total points possible = 700
Grading procedure – I will assume that your performance will follow a standard curve:
A: > 90% B: 80% - 89.9% C: 70% - 79.9% D: 60% - 69.9% F: < 59.9%
This curve reflects my general expectations of student performance based on the nature and difficulty of the course and the assignments. Should student performance vary significantly from what I expect, I reserve the right to curve individual exams and/or the final point total.
Make-up Exam Policy – Except in the case of an “Institutional Excuse” no make-ups will be given to students who miss assignments and exams. However, for a missed exam the score of zero will be replaced by the score earned on the Final Exam (see below for more on this exam).
Note that this will only apply to one missed exam.
Page 2 Syllabus – ECO 473 (2) – Spring 2015 - Foster

Missed classes – It is your responsibility to keep up with material in the class. Only if you miss a class as a result of an “Institutional Excuse” will you be given an opportunity to make up any points missed for that class, otherwise a zero will be recorded for this missed work.
Academic Integrity Policy – Unless otherwise noted, the work you do must be your own work. If not, a grade of zero will be given for the assignment/exam. Repeated offenses will result in expulsion from the class. Acts of academic dishonesty include, but are not limited to, plagiarism, using unauthorized crib notes and copying test answers from other students. Details on NAU’s policy in this regard can be found here: http://www4.nau.edu/avpaa/UCCPolicy/plcystmt.html
Student Conduct Policy – The W.A. Franke College of Business has a student code of conduct that you should be familiar with. It is printed below. Breaches of this code of conduct may result in zero credit for the class period (including weekly assignments, in class exercises, et al.), at my discretion. Behaviors I find especially egregious are coming into the classroom late, leaving the classroom early, getting up during class and leaving for a short period of time, and inattentiveness.
Miscellaneous: Food and beverages are not allowed in the classrooms. Computer laptops, tablets and cell phones must be kept out of sight and turned off unless you have some special circumstance that I need to be aware of. NAU supports and promotes a drug free environment.
Other related policies are printed below.
E-mail me: If you have questions/problems you want to ask about, you may see me during my office hours or schedule an appointment to see me. If you would like, you can also e-mail me with questions that you have. If you do this, please fill in the subject category as follows:
mail-ECO473-02-last name. This will help me to react and respond in a timely fashion.
Syllabus – ECO 473 (2) – Spring 2015 - Foster Page 3

DETAILS ON COURSE ASSIGNMENTS
Midterm Exams - The dates are noted on the course outline. Each exam will consist primarily of multiple choice questions, but may include definitional questions, graphical problems, work problems and short essays, as the case warrants. You may use a pen, or pencil, and a calculator. You may not share calculators. You may bring in one page of notes, 8.5 x 11 inch, one side only. You will be required to turn this in with your exam. These exams are worth
100 points each.
Comprehensive Final Exam - The date is noted on the course outline. This exam will be all multiple choice questions, drawn from test banks I will post up on my web site. No notes will be allowed. You may use, but not share, calculators. As the exact questions will be known in advance, I will be unavailable to discuss the specifics of these questions. If you believe that a question has more than one right answer, or no right answer, I will review it. If you are correct,
I will throw it out. This will be worth 200 points.
Special note concerning the final exam – As long as this exam score is higher, on a percentage basis, it will also replace the lowest of the midterm exam scores (on a percentage basis).
Weekly Q&A Papers – Pretty much every week, as noted on the course outline (WA#), you will be required to bring to class a typed out copy of answers to questions that I will give you over the reading assignment for the upcoming week. You are free to make written notes on these papers during the class period, but I will pick them up in Tuesday’s class and return them to you on Thursday. Generally this will be worth full credit as long as it is complete and you have put forth a reasonable amount of effort. But, note that this is an individual assignment and the work you turn in must be your own. Also, you must be present to receive credit. [Late arrivals for class discussion will only get partial credit.] At the end of the term I will drop the two lowest scores for this assignment and count only the remaining ten.
Extra Credit – There will be one specific opportunity for extra credit given for a video scheduled for class on March 31. [The extra credit will take the form of a quiz given at the end of the video.] There may be additional opportunities for extra credit, and if so it will be announced in class so that everyone will have the opportunity to participate. I will not offer any extra credit just to individual students.
Syllabus – ECO 473 (2) – Spring 2015 - Foster Page 4

W.A. Franke College of Business Student Code of Conduct
Responsibility: I will be on time, prepared, attentive, and professional in my scholastic endeavors. I will take responsibility for my actions and make every effort to learn as much as possible from the educational opportunities presented to me.
Respect: I will meet my commitments to others and treat everyone with respect and civility. I will respect our learning environment and help preserve its physical condition.
Integrity: I will be a reliable and honest contributor to individual and group assignments. I will not seek or help others gain unfair advantage in completing academic requirements. I understand that there are severe consequences for academic dishonesty.
Expectations of Behavior
Responsibility:


Attend all classes and meetings on time
Do not wander in and out of classes
 Participate but don’t dominate
 Pay attention
Respect:



Turn off cell phones when you are in class
Do not use computers during lectures for non class-related purposes
Make sure language and conversations are appropriate to the classroom setting
 Behave in a polite and professional manner
Integrity:
Do not engage in any act of academic dishonesty, including but not limited to:

 sharing a calculator during a quiz or exam pre-programming a calculator for use during a quiz or exam unless specifically authorized by the instructor
 using notes or books during an exam unless specifically authorized by the instructor

 looking at another's exam or allowing another student to look at your exam

 exchanging exams, passing notes or text messages
 discussing answers during an exam having another take an exam for you or taking an exam for another unauthorized possession of or access to examination materials by any means, including electronic
 transmission, theft, photocopying, electronic or failing to return exams altering exams or assignments while in student's possession for review in an attempt to obtain a more
 favorable grade
 unauthorized collaboration on assignments submitting the same paper or substantial portions of a paper for multiple classes
 fabrication of information and citations
 submitting other's words, ideas, materials or work without properly acknowledging and appropriately referencing them
 altering, forging, or misusing an academic record
 electronic theft of computer programs, data, or text belonging to another.
Syllabus – ECO 473 (2) – Spring 2015 - Foster Page 5

Dr. D. Foster
Course Outline
Week 9
Week 10
Week 11
Week 12
Week 13
Week 14
Week 15
Week 5
Week 6
Week 7
Week 8
Week 1
Week 2
Week 3
Week 4
Date Topic
Exam #3
Exam #4
April 23, 2015 Great Depression I
April 28, 2015 Great Depression II web page: oak.ucc.nau.edu/dlf/ e-mail: dennis.foster@nau.edu
January 13, 2015 Overview & Introduction to Money
January 15, 2015 Money & Banking Basics I
January 20, 2015 Money & Banking Basics II
January 22, 2015 Supply & Demand for money
January 27, 2015 Bank Structures
January 29, 2015 Asymmetric Information
February 3, 2015 Exam #1
February 5, 2015 Economic Failure - 2008+
February 10, 2015 Money Creation
February 12, 2015 Money Creation problems
February 17, 2015 Central Bank basics
February 19, 2015 U.S. central bank history
February 24, 2015 The Fed - structure
February 26, 2015 The Fed - policy and critique
March 3, 2015 Exam #2
March 5, 2015 Financial markets
March 10, 2015 Financial instruments; regulation
March 12, 2015 Interest rates I
Spring Break (March 16 - March 20)
March 24, 2015 Interest rates II
March 26, 2015 Money Demand
March 31, 2015 Video - Peter Schiff
April 2, 2015
April 7, 2015 AS/AD I
April 9, 2015 AS/AD II
April 14, 2015 ABCT I
April 16, 2015 ABCT II
April 21, 2015
April 30, 2015 Current Issues
Reading
Roth 1
M&B 1,3
Roth 4
Roth 2-3
R 6-7; M&B 9
M&B 8
Woods 1-3
M&B 14-15
Roth 8-12
R 13-15; M&B 13
M&B 16-17
R 16; Woods 6
M&B 2
M&B 11
M&B 4-6
Roth 5; M&B 20
M&B 23-24
M&B 25-26
Woods 4
Smiley 1-2
Smiley 3-5; W 5
R 17; M&B 12; W 7
Final Exam (S2): Thursday, May 7; 12:30 pm - 2:30 pm
Assign.
WA 1
WA 2
WA 3
WA 4
WA 5
WA 6
WA 7
WA 8
WA 9
WA 10
WA 11
WA 12
Syllabus – ECO 473 (2) – Spring 2015 - Foster Page 6