Risk Assessment Is Best Described By

question 56

Multiple Choice

Risk assessment is best described by:

• A) Internal and external events affecting achievement of an entity's objectives must be identified, distinguishing between risks and opportunities.
• B) Management selects whether to avoid, accept, reduce, or share risk -developing a set of actions to align risks with the entity's risk tolerances and risk appetite.
• C) The entirety of enterprise risk management is monitored and modifications made as necessary.
• D) The likelihood and impact of risks are analyzed, as a basis for determining how they should be managed.

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Definitions:

External Factors

Conditions, events, or influences originating outside an organization that can affect its performance and strategic decisions.

Startup Capital

Initial funding used to start a business, covering costs such as product development, market research, and operational expenses until the business becomes self-sustaining.

Small Business Success

The achievement of desired visions and planned goals, leading to a sustainable competitive advantage for a small business, often measured by financial performance, market share, or innovation.

Creative Destruction

An economic theory that suggests the dismantling of long-standing practices in order to make way for innovation and new systems that enhance economic vitality.