What causes the movement of people, ideas, and products across borders (i.e., what help cause globalization)?
Globalization is a result of push and pull factors that can be a consequence of economic, political, and social forces. Not only are wars, political oppression, and the desire to escape these things some of the reasons for the movement of people, but global governance structures and NGO's help these processes occur. Economically speaking, people move to seek better opportunities for work; products transcend borders in efforts to capture market share. Together, these forces can stir great social changes such as the mixture of cultural forms into sub-categories of umbrella social groups and even incite social justice movements which may cause more globalization to occur. All of these forces work both independently and together in order to create a more globalized world.
What is the definition of a derivative?
A derivative is the rate of change of a function as the distance between two points on that function approaches an infinitesimally small number (instantaneous rate of change).
How do foreign exchange rates relate to a nation's monetary policy? What type of models are used to describe these relationships?
Monetary policy is both affected by and affects foreign exchange rates. Depending on the type of foreign exchange rate policy a nation chooses, a nation may or may not have the freedom to choose monetary policies at all. Fixed exchange rates prevent a nation's central bank from intervening within their economy's boom and bust cycles because their monetary supply is used to control exchange rate fluctuations instead of creating changes in recessions or inflation. When one nation decides to use their monetary policy to create growth, it may cause the value of their currency in relation to others to increase. This may influence the interest rates of other countries to change as growth in the form of imports and exports may decrease or increase to such an extent that the affected nation may experience higher levels of spending. One model that is often used to describe these relationships is the Mundell-Fleming model.