1 How could Jim adjust his operations to reduce his economic exposure? What is a possible disadvantage of such an adjustment?

Jim Logan, owner of the Sports Exports Company (Ireland), remains concerned about his exposure to exchange rate risk. Even if Jim hedges his transactions from one month to another, he recognizes that a longterm trend of depreciation in the British pound could have a severe impact on his firm. He believes that he must continue to focus on the British market for selling his basketballs. However, he plans to consider various ways in which he can reduce his economic exposure.
At the current time, he obtains material from a local manufacturer and uses a machine to produce the basketballs, which are then exported.