Quantitative risk is the numerical determination of the probability of an adverse event and the extent of the losses due to the event. Quantitative risk is calculated as:
Quantitative risk is calculated as the product of the probability of loss and the loss itself. This formula provides a numerical value that represents the expected impact of a risk event. Mathematically, it is expressed as:
Quantitative Risk = (Probability of Loss) × (Loss)
This calculation helps organizations prioritize risks based on their potential financial impact and make informed decisions about risk mitigation strategies. The other options do not correctly represent the quantitative risk formula.
Impact formula
% of being impacted by a event * Business impact = Risk
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