In risk management, what describes the 'likelihood' of a risk?

In risk management, what describes the 'likelihood' of a risk?

• A. The severity of impact if it occurs.
• B. The probability that the risk event will occur.
• C. The cost of mitigation strategies.
• D. The time to implement mitigations.

Answer: (B)

In risk management, likelihood is the probability that the risk event will occur. This focuses on how often the event could happen, separate from how severe the impact would be if it does occur. Assessing both how likely something is and how big the impact would be lets you prioritize which risks to address. For example, a risk that is quite likely but has moderate consequences may need action, while a highly unlikely event with massive consequences might still warrant contingency plans. The option describing severity deals with consequences, not frequency; the option about cost relates to financial impact of mitigation; and the option about timing concerns how quickly you can respond, not how likely the event is.