Question

Isabella works as a risk specialist for her company. She wants to determine which risks should be managed and which should not by applying a test to each risk. Risks that don't meet the test are accepted. What type of test does she apply.

A. Control test
B. Vulnerability test
C. Reasonableness test
D. Cost assessment

Answer 1

A risk specialist like Isabella would likely use a cost assessment to determine which risks should be managed, by comparing the potential cost of a risk against the cost of controlling it.

Step-by-step explanation:

Isabella, working as a risk specialist, wants to determine which risks to manage by applying a specific test, and it is likely that she will employ a cost assessment. A cost assessment evaluates whether the cost of managing a risk is less than the cost of accepting the risk.

By comparing the potential cost of risk occurrence against the cost of implementing controls, Isabella can make informed decisions on whether it's financially reasonable to take action on a risk or simply accept it. Risks that do not pass this test, meaning the cost of management would be higher than the cost of acceptance, are accepted as part of the normal course of business.

Isabella applies a test called the Reasonableness test to determine which risks should be managed and which should be accepted. The Reasonableness test involves evaluating whether the costs and efforts required to manage a particular risk are reasonable in relation to the potential impact and likelihood of the risk occurring.

C. Reasonableness test is correct