The Financial Sector in Macroeconomics: Free Course

About this course

Financial instruments connect household saving, bank lending and business investment. This course examines those connections through interest, money, balance sheets and two different market models. Study the complete public source playlist from Khan Academy in English, with all 20 recordings available in the on-site classroom. Lessons retain their original titles and source order, including worked examples, introductions and repeated entries.

Course at a glance

What you’ll learn

• Distinguish bonds, shares and the claims their holders receive.
• Compare nominal returns with returns adjusted for inflation.
• Trace deposits, reserves and loans through a bank balance sheet.
• Interpret money-market and loanable-funds diagrams without mixing their variables.

Skills you’ll gain

• Interest rates
• Bank balance sheets
• Monetary aggregates
• Loanable funds

Course Overview

The opening lessons distinguish a bondholder’s lending relationship from a shareholder’s ownership claim. Return is then examined in nominal terms and in purchasing-power terms, so an apparent monetary gain is not automatically a real gain. The monetary section connects the functions of money with monetary aggregates and the distinction between commodity and fiat money. Bank balance sheets provide a concrete way to follow reserves, deposits and lending in the fractional-reserve model used by the recordings. The final lessons move from individual banks to money-market equilibrium, monetary-policy tools and the loanable-funds market. Keep those models separate: their axes, interest-rate concepts and explanations of supply and demand serve different analytical purposes. National saving and investment bring the course back to the connection between financing and real economic activity.

How to study the course

• Videos 1–5: this part of the source list includes “Introduction to interest” through “Bonds vs. stocks”. List the assumptions of the model. Keep a brief working note, revisit an unclear explanation and test one example before moving to another part of the material.
• Videos 6–10: this part of the source list includes “Real and nominal return” through “Functions of money”. Identify the participants and incentives. Keep a brief working note, revisit an unclear explanation and test one example before moving to another part of the material.
• Videos 11–15: this part of the source list includes “When the functions of money break down: Hyperinflation” through “Bank balance sheet free response question”. Compare outcomes after one defined change. Keep a brief working note, revisit an unclear explanation and test one example before moving to another part of the material.
• Videos 16–20: this part of the source list includes “Demand curve for money in the money market” through “National savings and investment”. Explain a mechanism before making a conclusion. Keep a brief working note, revisit an unclear explanation and test one example before moving to another part of the material.

Who is this for?

This course suits students and interested readers studying the named economic concepts. It also provides a recorded reference for revisiting a topic after an earlier lesson or study attempt. Choose examples appropriate to your background and allow time to work through the method instead of judging understanding only by how familiar the terminology sounds.

Before you start

Basic arithmetic and comfort interpreting a graph are useful. Follow the assumptions of each model rather than treating every simplified example as a real-world prediction.

Put the lessons into practice

Construct a fictional bank balance sheet and record the effects of a new deposit and a loan under an explicitly stated reserve assumption. Separately compare the nominal and real return on a simple investment. Finally, sketch a money-market diagram and a loanable-funds diagram, label each axis and explain why a change has the particular effect shown in that model. Treat this as a model exercise, not a prediction or investment recommendation.

This optional study activity is provided by WikiFree for independent practice. Keep your working notes and use the relevant classroom recording to check a step, definition or interpretation. It is not an instructor-marked assignment.

Certificate / Assessment

Watching the public videos and using WikiFree completion tracking does not award a certificate, academic credit, an examination voucher or instructor assessment. Use your practice output to review what you can explain and repeat independently. The recorded lessons provide study material; completion tracking records your progress through that material.

Frequently asked questions

Provider: Khan Academy. Videos play from the Khan Academy channel on YouTube.