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This 8 page Class Notes was uploaded by Dominic Erdman on Saturday October 3, 2015. The Class Notes belongs to FRL315 at California State Polytechnic University taught by LinTan in Fall. Since its upload, it has received 14 views. For similar materials see /class/218176/frl315-california-state-polytechnic-university in Finance,Real Estate&Law at California State Polytechnic University.
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Date Created: 10/03/15
Study Guide for Midterm Exam 1 Chapter 1 Introduction 1 2 3 4 What are nancial market surplus unit and de cit unit What are the different types of nancial markets What are the major types of capital market securities What are the main depository and nondepository institutions Chapter 2 Determination of Interest Rate 2 Elkb 509080 Be able to explain loanable funds theory Who demand funds Who supply funds What are the characteristics related to each demander and supplier How economic growth affect interest rate How in ation affect interest rate What is Fisher Effect Be able to calculate real nominal rate using sher equation How interest rate changed after September 11 How budge de cit affect interest rate How foreign ow of funds affect interest rate How Net Demand ND for fund affect interest rate Chapter 3 Structure of interest rate 59 V39 How default risk liquidity tax status term to maturity and some special features of debt securities affect interest rate Know the yield differentials and how to estimate yield What are the three theories explaining term structure Explain each of them Using pure expectation theory to explain the change of yield curve with expectations of rising or falling interest rate Be able to calculate forward rate Chapter 4 Functions of the Fed l Elk59 What are the ve major components of Fed What is the function of them What is open market operations How does it affect money supply When Fed adjust discount rate how does it affect money supply When Fed adjust reserve requirement ratio how does it affect money supply What is money multiplier and how does it work Chapter 6 Money Market 1 2 E 8994 9 What are the major types of money market securities Know about the basics for Tbill ithe issuer auction face value no interest payment Be able to calculate Tbill price Tbill yield Tbill discount Know about the basics for commercial paper Be able to calculate commercial paper yield What is Negotiable CDs Be able to calculate NCDs yield What is Repo and reverse Repo Calculate Repo yield What is Federal Funds What is Banker s acceptance Know the international trading cycle where Banker s acceptance exists Be able to compute effective yield when valuing foreign money market securities FRL915 01 Financial Markets and Institutions Professor Lin Tan Syllabus Financial Markets and Institutions FRL 31501 California State Polytechnic University Pomona College of Business Administration INSTRUCTOR Dr Lin Tan Of ce Building 66 Room 224 Telephone 9098694587 Email Ltancsupomonaedu Of ce Hour Monday amp Wednesday l200pm Tuesday 300600pm OBJECTIVE The objective of this course is to provide an overview of the nancial markets and the major types of nancial institutions REQUIRED TEXTBOOK AND MATERIALS The textbook for the course is Financial Markets and quot quot 10TH edition by Jeff Madura In addition students are required to use a nancial calculator for some chapters Students planning to be nance majors are strongly encouraged to read the Wall Street Journal regularly Other excellent newspaper is the Financial Times which provides more indepth coverage of intemational nancial markets Both publications offer discounted subscriptions to students You may also access the Wall Street Journal online edition through university library ej oumal EMAIL You may send me your questions by University Email account NOT through BLACKBOARD or other email accounts Instructor will only respond to questions sent through university email BLACKBOARD Iwill administer other aspects of this course including grades through Blackboard environment which is accessible through the university Blackboard portal httpsblackboardcsupomonaedu Course materials can be downloaded from this site You should print lecture notes and bring them to class with you to facilitate effective notetaking during class They will also provide you with a basic framework in the event that you miss a class COURSE GRADE The grade for this course will be from I Two mid term exams each counting for 25 The second midterm will not be cumulative I A nal exam counting for 25 The nal exam will be cumulative l FRL915 01 Financial Markets and Institutions Professor Lin Tan I A written paper and presentation counting for 10 Please refer to Group Project Guideline I Class Participation and Punctual Attendance counting for 5 It is expected that students will attend all classes and be prepared to discuss the subject matter assigned Leaving early or coming in late will count as an absence Participation includes attendance inclass assignments and speaking in class during the discussion Ifyou miss all or part ofa class when participation is checked you forfeit the opportunity There are no makeups for class participation points Repetitive late arrival will adversely impact the Grade and disruptive late arrival shall be reported to the FRL Chair I Group Homework counting for 10 Please refer to Group Homework Guideline The course grade is based on the following scale Score Grade 90 and above A 80 and above B 70 and above C 60 and above D Below 60 F ADDITIONAL NOTEWORTHY ITEMS I No usage of personal laptops all kinds of cellphones including smartphones in class unless directed or permitted by the instructor I No food no conversations in class especially while lecture is in progress I Bring book power point slides and calculator to every class meeting I Ifnecessary the grade will be curved to achieve a reasonable average class score above C I The midterm exams and the nal exam will be closedbook and may include multiple choice questions and essay questions For multiplechoice questions no partial credit will be awarded You will not be permitted to share a calculator during the exam so you should check your batteries prior to the exam Iwill provide a formula sheet on the exam and you will not be allowed to bring or use any additional paper To the extent possible based on the number of students enrolled you must have one empty seat between you and the person seated next to you during the exam I Makeup midterm exams will not be given and absences will be excused only in the most extreme circumstances I will decide what is considered extreme Iffor any reason you are unable to take the exam at the scheduled time you must notify me in advance by both telephone and email Failure to provide advance notice will result in a grade of zero for the exam You will have to provide written documentation within one week regarding your FRL915 01 Financial Markets and Institutions Professor Lin Tan absence Ifyour absence is excused the weight of the midterm exam will be transferred to the nal exam There is no makeup nal exam I Note you must bring a photo ID either your school ID or your driver s license with you to each exam No one will be allowed to take an exam without a photo ID No one will be allowed to leave the room after the exam begins until they are nished the exam and no one will be admitted to the room after 10 minutes following the start of an exam Cheating on an exam will result in a grade of F for the course and the incident will be reported to the university s Of ce of Judicial Affairs I Any questions regarding your grade must be communicated to me in writing within one week after the grade is assigned You are responsible for keeping any backup copies of inclass assignments I There will be no exceptions to the above policies NOTE Ifyou have dif culty with the material or become concerned about a poor grade see me immediately If you seek help early it is likely that serious problems can be avoided Ifyou wait until a day or two before an exam I cannot provide much help because the material has to be absorbed steadily over time UNIVERSITY POLICIES AND STUDENT SUPPORT The following website lists places to assist you in the 39 httpwww edn J 39 H t Email is the of cial method of communications to students please check your university email frequently and do not let your email get overloaded Cal Poly Pomona as a leamingcentered university is committed to student success Students with disabilities are encouraged to contact me privately or the Disability Resource Center to coordinate course accommodations FRL915 01 Financial Markets and Instfutions Course Outline Tentative Professor Lin Tan Note This is a tentative schedule and changes may occur Session Date Topic Chapters Note 1 Welcome Syllabus Role of Financial 1 Jan 4 W Markets and Institutions 2 Jan 9 M Interest Rate Theory 2 3 Jan 11 W Term Structure 3 4 Jan 16 M Martin Luther King s Birthday No class 5 Jan 18 w Fed and Monetary Theory1St Presentation 4 1St grp hw due 6 Jan 23 M Money Market 2quotd Presentation 6 2quotd grp hw due 7 Jan 25 NIid term Exam 1 12346 8 Jan 30 M Bond Markets3rd Presentation 8 3rd grp hw due 9 Feb 1 W Mortgage Markets 3rd Presentation cont d 9 10 Feb 6 M Commercial Banks 43911 Presentation 17 43911 grp hw due 11 Feb 8 w Commercial BanldRisk 1719 12 Feb 13 M Managing Commercial Bank Risk Cont d 19 13 Feb 15 NIH term ExamZ 8111719 14 Feb 20 M Futures Markets Mutual Funds 1323 15 Feb 22 W Mutual Funds 51h Presentation 23 5Lh grp hw due 16 Feb 27 M Options Markets 14 17 Feb 29 W Catch upReView 18 Mar 5 M Project Presentation Project due 19 Mar 7 W Project Presentation Cont d Mar 12 M 20 350 Pm Final Exam 131423 550 pm I FRL915 01 Financial Markets and Institutions Professor Lin Tan Group HomeworkPresentation Guideline 1 Each group contains 13 students depend on class enrollment A group number will be assigned to each group Please use a cover sheet for all homework On cover sheet include group number students names the topic title and topic number For example if your group is No l with students Jane Smith and John Garcia and you work on topic 4 for homework 2 please type a Homework No 2 b Group No l c Student names Jane Smith and John Garcia d Topic No 4 e Title II Each group has different homework topic for each presentation The topics are listed on Blackboard under assignmen Please ask one person in the group submit the homework before due date 111 Each presentation uses PowerPoint around 68 slides IV The content of these mini presentations contain presenters own words summ of other resources Please do NOT repeat Professor s PowerPoint slides textbook or intemet de nitions answer the questions right to the point For example if you refer to some large amount of quotation from a website please summarize and do not show your navigation process in the presentation V For each presentation a base grade will be assigned based on research and presentation quality as well as how well the audiences questions are addressed A small component of the grade is based on the participation of others presentations Every student in the group has the chance to evaluate other group members research effect by assigning a peer grade The homework grade may be oated down 20 by peer ade VI Other policies regarding Research Homework Presentation a If presenters isare late for its presentation turn but present before the end of the class presentation there will be a 20 grade deduction b prresenters miss the presentation completely a grade of zero will be assigned for the related research homework c All presentations should be submitted through Blackboard to screen for plagiarism before due date If fail to submit on time there will be a 20 grade deduction d Other remaining policies if there is any will be announced in class Group Proj ect Presentation Guideline The goal of this research is to urge you to link finance knowledge obtained in this class with the real nance world You should research Wall Street Journal and other resources to obtain background and information about the current situation of the US financial market 5 FRL915 01 Financial Markets and Institutions Professor Lin Tan and institutions You may also research the global market The project should re ect your research and understanding in the related areas II The above Research Homework guideline I IV V and VI apply HI Write a group term paper using the following guidelines 1 Paper length maximum 10 pages of typed page with double spaces The paper length does not include reference page 2 The paper should include at least the following sessions title introduction main body conclusion and the list of references 3 It is necessary to note in the text where do you use the reference Include reference at the end of the report and note the reference in the text For example you summarize the securitization process of Jeff Madura s Financial Markets and Institutions in your paper in the parentheses please note the resources Your Text your text Madura 2011 And in the references page list the complete name of the authors publications article names and so on 4 A presentation about 1012 minutes is scheduled at the end of the quarter IV Project due A paper copy ofthe written project due March 5 2012 at the beginning of the class The instructor may change the content of the above syllabus during the course of this class Any change will be announced in class
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