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We estimate the money demand function and the money supply function for Canadasimultaneously by the three-stage least squares method. The inflation gap and the output gap are incorporated in the money supply function. Real money demand is positively affected by real GDP and negatively associated with the Treasury bill rate and the nominal effecttive exchange rate. Real money supply is positively influenced by the Treasury bill rate and negatively impacted by the inflation gap and the output gap.
This paper proposed a risk assessment model
with which supervisory authorities can calculate the money laundering risk
(MLR) level of financial institutions and make comparisons among multiple
institutions. The model is based on the Analytic Hierarchy Process (AHP) and
decomposes MLR into two second-tier criteria, i.e. Inherent Risk & Control
Risk. AHP pair wise comparisons made by the experts from various fields are
processed through AHP software to get the weight of each factor. Using this
model, MLR of each financial institution could be obtained and certain comparison
among them could be carried out.
The study examines money supply and inflation rate in Nigeria. Secondary data that ranged between 1970-2008 were sourced from the CBN Statistical Bulletin. The study used Vector Auto Regressive (VAR) model. The stationary properties of the model were also explored. The results revealed that money supply and exchange rate were stationary at the level while oil revenue and interest rate were stationary at the first difference. Results from the causality test indicate that there exists a unidirectional causality between money supply and inflation rate as well as interest rate and inflation rate. The causality test runs from money supply to inflation, from the interest rate to inflation and from interest rate to money supply. The paper concludes that government should use the level of inflation as an operational guide in measuring the effectiveness of its monetary policy.