b. Knows the various measures of the money supply 2. Understands how banks create money a. Understands how create money b. Understands the concept of the money multiplier 3. Understands the structure and functions of the Federal Reserve System a. Knows the structure of the Federal Reserve System b. Understands the role and functions of the Federal Reserve 4. Understands how the Federal Reserve uses the tools of monetary policy a. Understands how the Federal Reserve uses the of monetary policy to change the money supply 5. Understands the demand for money and its determinants (e.g., interest rates, income) a. Understands the demand for money and its determinants b. Understands the relationship between the quantity of money demanded and the interest rate 6. Understands the function of financial markets and the categories of investment instruments (e.g., stocks, bonds, money markets)
b. Knows the various measures of the money supply 2. Understands how banks create money a. Understands how create money b. Understands the concept of the money multiplier 3. Understands the structure and functions of the Federal Reserve System a. Knows the structure of the Federal Reserve System b. Understands the role and functions of the Federal Reserve 4. Understands how the Federal Reserve uses the tools of monetary policy a. Understands how the Federal Reserve uses the of monetary policy to change the money supply 5. Understands the demand for money and its determinants (e.g., interest rates, income) a. Understands the demand for money and its determinants b. Understands the relationship between the quantity of money demanded and the interest rate 6. Understands the function of financial markets and the categories of investment instruments (e.g., stocks, bonds, money markets)