Topic: Economics of money and banking

Answer ONE question from Part A and ONE question from Part B.
Questions in Part A carry 30 per cent of the total mark of the present coursework each and questions
in Part B carry 70 per cent of the total mark of the present coursework each. Your work should not
exceed 1500 words in total. Each question in Part A has a word limit of 500 words and each question
in Part B has a word limit of 1000 words.
In cases where a student answers more questions than requested by the examination rubric, the policy
of the Economics Department is that the student’s first set of answers up to the required number will
be the ones that count (not the best answers). All remaining answers will be ignored.
PART A
Answer ONE question from this section.
A.1 “Excessive growth of credit may hurt economic growth”, Rousseau and Wachtel (2011). Explain
this statement and provide two arguments in support.
A.2 The former Governor of the Bank of England, Mark Carney, has raised the prospect that,
after Brexit, the EU rule which puts a cap on bankers’ bonuses could be scrapped. Explain
the economic rationale of this statement in the light of market failure argument(s) to justify
regulating bankers’ bonuses.
ECON0038 1 TURN OVER
PART B
Answer ONE question from this section.
B.1 “Banks are too big and should be broken up to curb the risks that “King Kong” lenders still pose
to the economy”, A.Haldane (2012).
In this provocative statement Andrew Haldane argues that to address properly the“too-big-tofail” problem regulators should consider full separation of investment and commercial banking
rather than a ring-fence.
Discuss the statement. Your arguments should be supported by economic analysis, literature
references and real world examples.
B.2 “The recent crisis was particularly severe because of the interaction between the specific characteristics of maturity transforming banks and securitised credit markets. Structural solutions
will not be sufficient to address the potential for instability inherent in such a credit system”, A.
Turner (2010).
Discuss this statement. Your arguments should be supported by economic analysis, literature
references and real world examples.

Type of service-Academic paper writing
Type of assignment-Essay
Subject-Economics
Pages / words-6 / 1500
Number of sources-6
Academic level-Undergraduate
Paper format-APA
Line spacing-Double
Language style-UK English

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