The document is a chapter from a corporate finance textbook that discusses managing international risks. It covers several topics related to foreign exchange markets including the relationship between interest rates and exchange rates, how forward premiums relate to changes in spot rates, how exchange rates are affected by inflation rates, and how companies can hedge currency risks using tools like forward and options contracts. It also discusses political risks that multinational firms may face abroad such as risks posed by changes in policies or political instability in foreign markets.