We are all linked by international trade, and the volume of that trade has grown dramatically in the last few decades. The first wave of globalization started in the nineteenth century and lasted up to the beginning of World War I. Over that time, global exports as a share of global GDP rose from less than 1% of GDP in 1820 to 9% of GDP in 1913. Business and economics research advisor, BERA: A series of guides produced by Specialists in the Business Reference Section of the Science, Technology & Business Division that serves as reference and research guides for subjects related to business and economics. Issue 7/8 covers issues relating to International Economics and Trade. (Business Reference Services; Science, Technology, and International Money and Banking, continued The next two lectures use the Treynor model to understand how exchange rates are determined in dealer markets. In the second, we confront directly the puzzle we observed earlier in the course, namely why uncovered interest parity (UIP) fails to hold in real world markets.