currency interest rate and exchange rate.pptVIP

Learning Goals Outline the relationship between the short run and long run effects of monetary policy and explain the concept of short run exchange rate overshooting Outline of the chapter Money defined: a brief interview (货币定义) Money demand （货币需求） Equilibrium in money market（货币市场均衡） Money supply and interest rate （货币供给和利率） Output and interest rate（产出和利率） The Money Supply and the Exchange Rate in the Short Run（货币与汇率的短期分析） The money supply and the exchange rate in the long run （货币供给与汇率的长期分析） Money Defined: A Brief Review Money as a Medium of Exchange（交换手段） A generally accepted means of payment Money as a Unit of Account（计价单位） A widely recognized measure of value Money as a Store of Value（储存手段） A transfer of purchasing power from the present into the future Money Defined: A Brief Review How the Money Supply Is Determined（货币供给的决定） An economy’s money supply is controlled by its central bank.（货币供给由中央银行控制） The central bank: Directly regulates the amount of currency in existence Indirectly controls the amount of checking deposits issued by private banks Aggregate Money Demand Aggregate money demand（货币需求） The total demand for money by all households and firms in the economy. It is determined by three main factors: Interest rate（利率） It reduces the demand for money. Price level（价格水平） It raises the demand for money. Real national income（实际国民收入） It raises the demand for money. Aggregate Money Demand The aggregate demand for money can be expressed by: Md = P x L(R,Y) (14-1) where: P is the price level Y is real national income L(R,Y) is the aggregate real money demand Equation (14-1) can also be written as: Md/P = L(R,Y) (14-2) （See 姜波克 《国际金融》 汇率决定理论 货币分析法） Aggregate Money Demand Equilibrium in the Money Market（货币市场均衡） The condition for equilibrium in the money market is: Ms = Md (14-3) The money market equilibrium condition