ENVIRONMENT OF INTERNATIONAL FINANCIAL MANAGEMENT
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This section consists of the following subsections:

 Determination of Exchange Rates

 The International Monetary System

 The Balance of Payments

 Foreign Exchange Market

 International Parity Conditions

These five themes basically define the environment in which a MNC functions.

Determination of Exchange Rates

One of the basic issues which a company should consider when stepping on a foreign market are the exchange rates of this country and the way by which they are determined.

Wikipedia gives the following definition for exchange rate: “in finance, the exchange rate between two currencies specifies how much one currency is worth in terms of the other.”
(http://en.wikipedia.org/wiki/Exchange_rates)

There are a number of methods that can be used to determine an exchange rate:

a) A flexible or floating exchange rate is where the......

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Title: The Key Themes Of Finance For A Multi-National Corporation
Approximate Word Count: 2788
Approximate Pages: 12 (250 words per double-spaced page)

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