Question: A firm is using the factor rating method to evaluate country risk as a first step in its location selection process. Legal issues, currency risk,

A firm is using the factor rating method to evaluate country risk as a first step in its location selection process. Legal issues, currency risk, political risk, and cultural compatibility have been assigned weights of 30%,10%,20%, and 40%, respectively. Three countries were scored on each of those risk factors (see table below) using a scale of 1-10, with a score of 1 meaning high risk and 10 meaning minor risk.
Argentina
Brazil
Columbia
Legal issues
2
6
10
Currency risk
8
4
2
Political risk
5
8
2
Cultural compatibility
3
1
2

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