Risk avoidance is the best risk management tool when the chance of loss is _____ and the loss severity is _____.

Question

Question: Risk avoidance is the best risk management tool when the chance of loss is _____ and the loss severity is _____.

Options:

1.  High, high
2.  Low, low
3.  Low, high
4.  High, low
5.  Certain, low

Answer 1

1. High, high

Risk avoidance is the best risk management tool when the chance of loss is high and the loss severity is high.

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More information:

Risk avoidance is the complete removal of risks, activities and exposure that could adversely affect the organization and its assets.

Avoiding risk does not do any potentially dangerous work. It should be used when loss chance is high and severity is also high.