Chapter 1 International Financial and Monetary Environment International financial management also known as International finance is a popular concept

which means management of finance in an international business environment, it implies, doing of trade and making money through the exchange of foreign currency . The international financial activities help the organizations to connect with international dealings with overseas business partners, customers, suppliers, lenders etc. It is also used by Government organization and non-profit institutions. International finance (also referred to as international monetary economics or international macroeconomics) is the branch of International finance (also referred to as international monetary economics or international macroeconomics) is the branch of financial economics broadly concerned with monetary and microeconomics interrelations between two or more countries. International finance examines the dynamics of the Global financial system, international monetary systems, Balance of Payments, Exchange rates, Foreign Direct Investment , and how these topics relate to International Trade. Sometimes referred to as multinational finance, international finance is additionally concerned with matters of international financial Management. Investors and multinational corporations must assess and manage international risks such as political risk and foreign exchange risk, including transaction exposure, economic exposure, and translation exposure. Some examples of key concepts within international finance are the Mundell Fleming Model, the optimum currency area theory, purchaging Power Party, Interest Rate Partyinterest rate party, and the International Fisher Effect. Whereas the study of international trade makes use of mostly microeconomic concepts, international finance research investigates predominantly macroeconomic concepts. International business IB means carrying of business activities beyond national boundary. This would be happen normally international trade of goods and services and also international production of goods and provision of services normally under the garb of foreign direct investment. To be precise, IB takes 3 modes, they are Modes of IB International Trade Export Import Contractual Entry Modes FDI International trade: Export Direct and Indirect Direct Occurs when a company takes full responsibility for making its goods available in the target market by selling directly or through its agents. Indirect Takes place when the exporting company sells its product to the end-users through Intermediaries , export houses etc., International Trade is primarily multilateral in character, but bilateral trade does exist in many cases.

Bilateral Trade, often known as counter-trade is sort of bartering of goods in different ways. Sometimes we may found industrial counter-trade or the buy-back agreement that involves the sale of