Monetary tools and targeting

Monetary tools and targeting

Bachelor of Business Studies (BBS) — Fourth Year

Subject: Management of Financial Institutions (FIN 255)

Unit 3: The Central Bank and Monetary Policy

Academic Year: 2083/84

Topic Objectives

After studying this topic, students should be able to:

• Explain the scope and key elements of monetary tools and targeting.
• Apply the relevant financial concepts or calculations and explain their assumptions, risks and analytical limits.

Curriculum Scope

• Monetary tools: Open market operation, the discount rate, and reserve requirements
• Effects of monetary tools on various economic variables
• Money supply versus interest rate targeting

Detailed Microsyllabus

1. Monetary tools

   1. Open-market operations.
   2. Discount rate and reserve requirements.
   3. Transmission under the specified model.

2. Targeting

   1. Money-supply versus interest-rate targeting.
   2. Effects on relevant economic variables.
   3. Compare assumptions and policy trade-offs.

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Curriculum reference: Tribhuvan University, Faculty of Management, revised four-year BBS curriculum, PDF pages 86–88.

Source note: The curriculum scope above is retained from the existing TU syllabus breakdown. The numbered study subtopics are editorial elaborations for teaching and study, rather than a separately issued TU syllabus. Unit or component allocations apply at their stated level; no separate topic hours or marks are assigned here. Examples involving current laws, rates, institutional products or Nepalese status must identify the relevant period and official materials; no changing numerical or legal requirements are invented here.