An organization knows that a risk exists and has decided that the cost of reducing it is higher than the loss would be. This can include self-insuring or using a deductible. This is categorized as:

Question

Social Studies

Bobby Stevens

5 May, 22:13

An organization knows that a risk exists and has decided that the cost of reducing it is higher than the loss would be. This can include self-insuring or using a deductible. This is categorized as:

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Answers (1)

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Rayan · Answer 1

Answer: Risk acceptance

Explanation:

Risk acceptance is defined as tendency of accepting the risk that has been researched and identified by any organization. These organization have the characteristics of not taking any risk management measure to avoid the known risks rather they bear the consequences or effect of that risk.

According to the question, any organization that knows about the risk and calculates that risk avoidance can be of higher cost and thus, they will accept the risk impact. So, they are displaying risk acceptance.