Question

A risk exposure is defined as the impact to the organization when a situation transpires. The widely accepted formula for calculating exposure is as follows: Risk exposure =________________ the event will occur + ____________ if the event occurs where, outcome likelihood, impact how, impact likelihood, cost

Answer 1

Likelihood, impact

Step-by-step explanation:

Risk exposure is defined as an estimation of future loss that can be experienced when a particular line of action is taken. There is ranking of risks according to the likelihood of them occuring multiplied by potential loss if the risk occurs.

The formula for risk exposure is the likelihood that an event will occur plus impact if the event occurs.

For example if an investor invests $1,000 in a high risk investment, he stand s the chance of losing the whole of the capital invested.