Month: October 2022

5.0 Introduction The Central Bank of Kenya (CBK), like most other central banks around the world, is entrusted with the responsibility of formulating and implementing monetary policy directed to achieving and maintaining low inflation as one of its two principal Read More …

3.1 Money demand The demand for money is the desired holding of financial assets in the form of money, that is, cash or bank deposit. It can refer to the demand for money narrowly defined as M1 (non-interest bearing holding) Read More …

2.1 Financial markets Financial market are institutions or arrangements that facilitate the exchange of financial assets, including deposits and loans, corporate stocks and bonds, government bonds, and more exotic instruments such as options and futures contracts. They are mechanism in Read More …

INTRODUCTION Money and banking are two subjects closely intertwined with our daily lives and with the very day functioning of our economy. On atypical day, you encounter money and banks in many firms like from the obvious contact made when Read More …

MONEY AND BANKS – Click to view FINANCIAL MARKETS, FINANCIAL INSTITUTIONS AND FINANCIAL INSTRUMENTS – Click to view MONEY DEMAND AND MONEY SUPPLY – Click to view CENTRAL BANKING – Click to view AGGREGATE DEMAND (AD) AND AGGREGATE SUPPLY (AD) Read More …

Definition of foreign exchange market Foreign exchange is the system or process of converting one national currency into another, and of transferring money from one country to another. The term foreign exchange is also used to refer to foreign currencies. Read More …

The Bretton wood institutions The Bretton Woods Institutions are the World Bank, and the International Monetary Fund (IMF). They were set up at a meeting of 43 countries in Bretton Woods, New Hampshire, USA in July 1944. Their aims were Read More …

Monetary policy Monetary policy refers to the manipulation of money supply, liquidity and interest rates in the economy in order to achieve increased employment, economic growth, reduced inflation and improved balance of payments. Monetary policy works through the intermediary of Read More …

Interest rates Interest rate is the price that a borrower of funds must pay to the lender to secure use of funds for a specified period. An interest rate is a predetermined or negotiated payment made or received for the Read More …

A Financial Market is an institution or arrangement that facilitates the exchange of financial assets. They are mechanisms in our society for converting public savings into investments such as buildings, machinery, infrastructure and inventories of goods and raw materials. This Read More …