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This instructor's manual complements the textbook Money: Theory and Practice which provides an introduction to modern monetary economics for advanced undergraduates, highlighting the lessons learned from the recent financial crisis. The manual provides teachers with exercises and examples that reflect both the core New Keynesian model and recent advances, taking into account financial frictions, and discusses recent research on an intuitive level based on simple static and two-period models.

Instructor's Manual for Money: Theory and Practice

Part I: Money and Equilibrium in the Long Run.- Long Run Growth: The Basic Framework.- Money and Long Run Growth.- Interaction Between Monetary and Fiscal Policy: Active and Passive Monetary Regimes.- Part II: Monetary Policy in the Short Run.- New Keynesian Macroeconomics.- Optimal Monetary Policy.- Monetary Policy Under Uncertainty.- The Liquidity Trap: Limits for Monetary Policy at the Effective Lower Bound.- Part III: Unconventional Monetary Policy, Financial Frictions and Crises.- Monetary Policy in Practice.- Financial Frictions and Monetary Policy.- Monetary Policy and Financial Stability.- Appendix: Dynamic Optimization Using Lagrangian and Hamiltonian Methods.- Dynamic Programming.