download full file at http://testbankcafe.com
download full file at http://testbankcafe.com
Contents
Preface ………………………………………………………………………………………………………………………………….. v
Alternative Course Outlines ……………………………………………………………………………………………………… vii
Ancillary Items for Financial Markets and Institutions, Seventh Edition ……………………………………….. xi
Part I Introduction ……………………………………………………………………………………………………………. 1
Chapter 1 Why Study Financial Markets and Institutions? …………………………………………. 2
Chapter 2 Overview of the Financial System ……………………………………………………………. 5
Part II Fundamentals of Financial Markets …………………………..……………………………………………. 9
Chapter 3 What Do Interest Rates Mean and What Is Their Role in Valuation? ……………. 10
Chapter 4 Why Do Interest Rates Change? ……………………………………………………….……… 16
Chapter 5 How Do Risk and Term Structure Affect Interest Rates? …………………………….. 23
Chapter 6 Are Financial Markets Efficient? ……………………………………………………………… 29
Part III Fundamentals of Financial Institutions ……………………………………………………………………. 33
Chapter 7 Why Do Financial Institutions Exist? ……………………………………………………….. 34
Chapter 8 Why Do Financial Crises Occur and Why Are They
So Damaging to the Economy? ………………………………………………………………… 40
Part IV Central Banking and the Conduct of Monetary Policy ……………………………………………… 45
Chapter 9 Central Banks and the Federal Reserve System ………………………………………….. 46
Chapter 10 Conduct of Monetary Policy: Tools, Goals, Strategy, and Tactics ………………… 50
Part V Financial Markets …………………………………………………………………………………………………… 57
Chapter 11 The Money Markets ………………………………………………………………………………. 58
Chapter 12 The Bond Market ……………………………………………………….…………………………. 63
Chapter 13 The Stock Market …………………………………………………………………………………… 69
Chapter 14 The Mortgage Markets ……………………………………………………………………………. 75
Chapter 15 The Foreign Exchange Market ………………………………………………………………… 86
Chapter 16 The International Financial System …………………………………………………………… 92
Part VI The Financial Institutions Industry ………………………………………………………………………….. 97
Chapter 17 Banking and the Management of Financial Institutions ………………………………. 98
Chapter 18 Financial Regulation ……………………………………………………….…………………….. 106
Chapter 19 Banking Industry: Structure and Competition …………………………………………….. 114
Chapter 20 The Mutual Fund Industry ……………………………………………………………………….. 117
Chapter 21 Insurance Companies and Pension Funds …………………………………………………. 123
iv Contents
© 2012 Pearson Education, Inc. Publishing as Prentice Hall
Chapter 22 Investment Banks, Security Brokers and Dealers,
and Venture Capital Firms. ……………………………………………………………………… 128
Part VII The Management of Financial Institutions ………………………………………………………………… 133
Chapter 23 Risk Management in Financial Institutions …………………………………………………. 134
Chapter 24 Hedging with Financial Derivatives …………………………………………………………… 143
Chapters on the Web
Chapter 25 Savings Associations and Credit Unions …………………………………………………….. 152
Chapter 26 Finance Companies………………………………………………………………………………….. 155
Solutions to Online Integrative Mini-Cases …………………………………………………………………………………. 157
Solutions to Online Mini-Cases …………………………………………………………………………………………………. 163
download full file at http://testbankcafe.com
download full file at http://testbankcafe.com
Preface
The demands for good teaching at business schools seem to us to have increased dramatically in recent
years. In order to aid busy instructors in this demanding environment, we have worked hard to make this
Instructor’s Manual a valuable teaching aid that will help reduce class preparation time.
The Instructor’s Manual is organized by chapter. Each chapter is broken into sections: Chapter Outline,
Overview and Teaching Tips (things we have found useful in the classroom), and Answers to End-of–
Chapter Questions and Problems. Before the chapter breakdown, and following this preface, are pedagogical
suggestions on such topics as how to organize the course and make use of the ancillaries, as well as solutions
to the mini-cases on the text’s Companion Website at www.pearsonhighered.com/mishkin_eakins. To
obtain access to other instructor resources associated with this textbook, please visit the Instructor’s
Resource Center Online at www.pearsonhighered.com/irc.
PLEASE NOTE THAT INSTRUCTORS HAVE PERMISSION TO DUPLICATE ANY OF THE
MATERIALS IN THIS INSTRUCTOR’S MANUAL FOR CLASSROOM USE.
While we believe that this Instructor’s Manual will be an extremely valuable tool in teaching the financial
markets and institutions course, we would also appreciate any suggestions or comments for improving this
supplement. Please direct all correspondence to us at the addresses below.
Frederic S. Mishkin
Stanley G. Eakins
Graduate School of Business
Department of Finance—School of Business
Uris Hall 817
3240 Bate Building
Columbia University
East Carolina State University
New York, NY 10027
Greenville, NC 27858-4343
Frederic S. Mishkin
Stanley G. Eakins
New York, New York
Greenville, North Carolina
