Unformatted text preview: to increase the prices of its drugs. Finally, XJP may reduce its sales especially tender sales which is over 80%in total China market because its higher price. This foreign exchange environment that XJP faced may bring out a great gulf fixed to XJP in Future growth. To reduce its harmful effect of XJP currency exposures, the firm needs to focuses on reduction in risk future cash flow. The firm can improve planning capability by this way. The firm can cope with future financial problems or future unpredictable investment plan, if the firm can foresee future cash flow precisely. Also, the firm needs to focus risk management. The firm should make a right decision which exposures to hedge for reducing foreign exchange risk by risk management in practice. The reason is many firms are actively hedging not only backlog exposures, but also selectively hedging quotation and anticipated exposures....
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This note was uploaded on 10/20/2011 for the course FIN 500 taught by Professor Yi during the Spring '10 term at CSU Dominguez Hills.
- Spring '10