Chapter 1

Money Makes the World Go ’Round

In This Chapter

arrow Understanding the terminology associated with exchange rates

arrow Identifying the factors that change the exchange rate

arrow Realizing excessive short-run volatility in the exchange rate and hedging against it

arrow Examining alternative exchange rate regimes

International finance is a vast and, at times, complex subject. My goal is to break it down for you into easy-to-manage parts. Although on the surface international finance may seem a daunting subject to learn, it really is fascinating and can help you understand the world of exchange rates. Time to get started!

This chapter aims to inform you about what’s to come throughout this book. Each section in this chapter corresponds to each of the five parts of the book and gives you a glimpse of what each part covers.

Checking Out Definitions and Calculations

When learning about any new subject, gaining a basic understanding of the important terminology and, whenever applicable, calculations is important. This fact is also true for international finance. The main subject in international ...

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