Public finance is the subdiscipline of economics that studies the various ways
Public Financial Management
Public Financial Management. I will be guiding you through budgeting and finance this semester. So a little bit about me. I went to Vanderbilt University for my undergrad, where I studied politics. And I was always interested in how government served its citizens and that role of government.
And so, initially, I thought politics would be my course. But after working for a nonprofit, a lobbying firm, a TV show, and on campaigns, I decided academics was more my speed.
I got my masters in public service administration at Texas A&M, my masters in economics at Georgia, and also my Ph.D. In public administration and policy at the University of Georgia, specializing in budgeting and finance.
So in this class, I’m going to take you through budgeting and finance. And the reason that this is required is because money will affect all of you. Joe Biden, in the 2012 election, said, my father always told me, don’t tell me what you value. Show me your budget. And I’ll tell you what is important to you. Well, I’m not sure his father actually said that to him.
But it’s true. A budget is a list of our priorities and what we value as a society and a government. And it’s really an encyclopedia. And that’s how we’re going to frame it.
This class is going to show you the best of what public administration is. It’s a multi-disciplinary approach. And so in this class, we’re going to start with budgeting. And we’re going to go over the nitty gritty of it. We’re going to talk about how it’s actually done, the timeframe, the actors involved. But we’re going to frame it from a political perspective.
And that’s really important. Because budgeting is about choices. And that, of course, involves politics. Then we’re going to move on and talk about the finance side. And we’re going to talk about revenue sources available to local governments, state governments, and the federal government.
And we’re going to approach this from an economics perspective. Along the way, we’re going to throw in accounting, financial management, and many other disciplines. Because to understand how we budget and finance our government, we really need to take a more holistic approach than you may be expecting. Whether you decide to go into budgeting and finance or are already in that world or not, this class will benefit you because it’s so important to understand where our money comes from. I’m really excited to embark on this journey with you.
And I really encourage you, when I ask these questions in the lectures, to go ahead and answer them in the forums and read what your classmates are saying and interact with them. Because you have a lot to learn from each other, as well, in this class, not just me. And so I’m really excited to see you all engage and bring your perspectives and how these different ideas have reached you or your different perspectives on them. So please, please don’t hesitate to be proactive in talking about it.
Disagree with me. Because there aren’t universal truths in budgeting and finance for the most part. I really look forward to seeing what you have to say in this class and to the synchronous sessions.
Why Study Economics at University?
Do you want to understand how the world works? Are you curious about the society you live in? Are you motivated to tackle real world problems? Do you want to help make the world a better place and enjoy a well-paid career at the same time? Have you considered studying economics? With economics you ask big questions such as why countries develop and why inequality persists. it also tackles the big problems including climate change inequality poverty and healthcare.
In order to find effective solutions to these problems you need insights from the economics of an economist. It’s not just money and numbers and graphs; it’s so much more. Your career opportunities are vast.
You could advise governments on policy, help a charity to work more effectively, make sense of big data in the tech sector, regulate an industry or forecast the economy.
You could do big industry work in the financial sector for a tech company, an economic consultancy the government or an NGO. Most economics graduates don’t work as economists. Instead, they use their skills in a diverse range of careers. Originally i’m from Eritrea and i left there when i was around age two and each time i went back i noticed that there were things like infrastructure where some things had improved, some got worse, and some things just didn’t change at all.
Certainly when i started a-level economics i realized that this was to do with economics; namely resource allocation decisions by the government.
Which of the following can be described as involving indirect finance
A corporation acquires new funds only when
- In financial markets, lenders typically have inferior information about potential returns and risks associated with any investment project. This difference in information is called
- Ans: comparative informational disadvantage.
- The problem created by asymmetric information before the transaction occurs is called _____, while the problem created after the transaction occurs is called _____
- Ans: adverse selection; moral hazard
- That depositors earn interest on checking and savings accounts, and yet withdraw their funds whenever necessary is possible because
- Ans: financial intermediaries lower transaction costs.
- In the United States loans from _____ are far _____ important for corporate finance than are
- Ans: financial intermediaries; more
- U.S. Treasury bills
- Ans: sell at a discount because they have no interest payments. are the most liquid of the money market securities.
- Which of the following statements about financial markets and securities are true?
- Ans: All of the above are true.
Which of the following statements about financial markets and securities are true?
Ans: A bond is a debt security that promises to make payments for a specified period of time. Equities usually make periodic payments called dividends and are considered to be long term securities because they have no maturity date.
Forty or so dealers establish a “market” in these securities by standing ready to buy and sell them.
Ans: U.S. government bonds
Which of the following do not provide charters?
Ans: The Federal Reserve System
Federal funds are
Ans: loans made by banks to each other.
Overview of the Financial System pdf
Which of the following are secondary markets?
Following are secondary markets:
(a) The New York Stock Exchange
(b) The U.S. government bond market
(c) The over-the-counter stock market
(d) The options markets
What are Primary & Secondary Markets? As a new investor in the stock market Vinod wants to understand the Primary & Secondary Markets.
The primary market is where the stocks are created and secondary market is where the stocks are traded When a company decides to go public for the first time by raising an IPO, it is done in the primary market. Here a company sells its shares directly to the investors.
After the shares are bought for the first time in the primary market, traders buy and sell these shares among themselves in the secondary market In the secondary market, the issuing company is not involved directly in any transaction.
So, in the primary market Vinod will buy shares directly from a company while in the secondary market, Vinod will buy or sell shares to another trader. With a better understanding, Vinod is now ready to trade with Angel Broking as his trusted partner.
An example of economies of scale in the provision of financial services is
An example of economies of scale in the provision of financial services is:
spreading the cost of writing a standardized contract over many borrowers
A) It determines the level of interest rates.
B) It allows common stock to be traded.
C) It allows loans to be made.
D) It channels funds from lenders-savers to borrowers-spenders.
Financial markets improve economic welfare because:
They allow consumers to time their purchases better AND the channel funds from savers to investors
Which of the following are securities
Which of the following are securities?
(a) A certificate of deposit.
(b) A share of Texaco common stock.
(c) A Treasury bill.
(d) They both can be long-term financial instruments.
(e) They both involve a claim on the issuer’s income.
(f) They both enable a corporation to raise funds.
Which of the following instruments are traded in a money market?
Interest rates and inflation together are perhaps the most significant macroeconomic variables that impact global financial markets, particularly money and debt markets. More so, given the free flow of capital across countries and the consequential emergence of globally interconnected financial systems.
As a result, managing price volatility and interest rate risks embedded in instruments traded in the money and debt markets have become exponentially more complex. Hello. My name is PD Narayan. I have been with the Indian Institute of Management Bangalore for the last 14 years engaged in teaching, research, and consulting primarily in the area of banking and finance.
In this course titled Money & Debt Markets– Concepts, Instruments, Risks, and Derivatives, we will examine, in detail, money markets or short-term financial markets such as call money markets, T-bill markets, repo markets, et cetera that make up the ecosystem to effectively manage money supply, that is liquidity, and ensure stability of the financial system in the short-term.
The second part of this course, we’ll look at debt markets, the underlying theories such as time value of money, bond pricing, bond valuation, as well as the structure and functioning of debt markets such as the corporate bond market, the government securities market, or the treasury bond market, as it is called in some countries, and the mortgages market.
We will also look at various types of interest rate risks that are embedded in the instruments traded in those markets and the tools and the techniques to manage those risks such as repricing models, duration and convexity, duration gap analysis, et cetera, as well as interest rate derivative instruments such as interest rate futures, interest rate swaps, interest rate options, and their role in not only helping institutions to hedge against those risks, but also to speculate and make some additional profits where possible.
So join me in this interesting journey to unravel the structure and functioning of money markets, debt markets, and the manifestations and impact of interest rate risks on those markets. How are they managed? And to what extent can they be mitigated? I look forward to seeing you in this course.