​Which of the Following Is True of an Inherent Risk

question 55

Multiple Choice

​Which of the following is true of an inherent risk?

• A) ​An inherent risk is the probability or likelihood of a risk occurring multiplied by the impact should it actually occur.
• B) ​An inherent risk is avoided by enacting some particular procedure to decrease the inherent risk to a lower residual risk level.
• C) ​An inherent risk can be defined as the difference between the risk response benefit and the residual risk produced by the particular risk response.
• D) ​An inherent risk is the risk that remains after any risk management action has been taken.

---

Definitions:

Raw Materials

Basic substances in their natural, modified, or semi-processed state, used as inputs for manufacturing finished goods.

Pure Monopoly

A market structure where a single supplier has exclusive control over the production and sale of a product with no close substitutes.

Pet Food

Specially formulated food intended for consumption by pets, which caters to their nutritional needs.