A highly accessible introductory textbook that equips students with the needed knowledge for further study. Advanced undergraduates and graduates will learn how to interpret the balance of payments of a country, explain the behavior of commercial flows, analyze flows of financial assets according to interest-rate differentials and other elements, evaluate the effects of national and international policies, study the forces that determine exchange rates and cause currency crises, and understand the reasons behind international economic integration, such as the European Union.