Final answer:
Risk management aims to prepare for and effectively react to uncertainties, mitigating the impact of potential risks (C). It does not seek to eliminate all risks or predict them perfectly but rather reduces negative consequences to a manageable level.
Step-by-step explanation:
The core objective of risk management is to prepare contingency plans and react effectively to uncertainties. It is about identifying potential risks, assessing their severity, and implementing strategies to mitigate the impact should those risks materialize. Although it would be ideal to eliminate all potential risks or forecast them with complete accuracy, the inherent nature of risk means that this is not always possible. Instead, effective risk management focuses on reducing the potential negative consequences of risks to an acceptable level.
As the information suggests, formulating plans to address risks, even those with a low probability of occurrence, can be a prudent decision. The logic is similar to why people purchase insurance: to protect against low-probability, high-impact events. The time and effort spent in planning and mitigating risks are justified by the potential to avoid catastrophic outcomes.