Month: March 2023

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 …

4.1 Difference between inflation and economic growth Inflation refers to general rise in the level of prices in the economy while economic growth refers to increase in quantity and variety of things available for consumption and is result of the 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 …

TOPIC 1: MONEY BANKS – Click to view TOPIC 2: FINANCIAL MARKETS, FINANCIAL INSTITUTIONS AND FINANCIAL INSTRUMENTS – Click to view TOPIC 3: MONEY DEMAND AND SUPPLY – Click to view TOPIC 4: MONEY AND INFLATION – Click to view Read More …

This is a persistent and generalized increase in price levels  making the consumers to have a low purchasing power. It is a process in which price levels are rising at a rapid rate and money is losing value. It is Read More …

The Determinants of Rate of Exchange The determination of foreign exchange rate can be traced from two theories of exchange rates. The Mint Power Parity Purchasing Power Parity The Mint Power Parity relates to equating standard coins of different countries Read More …

CORE CONCEPTS IN CORPORATE FINANCE. Forward contracts. This is a market for currencies that enables a MNC to lock in the exchange rate(forward rate) at which it buys or sells a currency.it specifies the amount of a particular currency that Read More …

The financial market deals with the purchase and sale of money. It therefore involves obtaining money from those who have more than they need by attracting it either as: deposits through commercial banks; premiums through insurance companies; units or shares Read More …