In a risk assessment exercise of a software implementation program, the business analyst (BA) has successfully computed the probability of occurrence (POC) and the cost of impact for each of the identified risks as follows:
Which of the following will have the highest negative impact to value?
To determine the highest negative impact, we calculate the expected impact for each risk by multiplying the probability of occurrence (POC) by the cost of impact. For 'Natural disasters': 0.2 * 15000 = 3000 USD, for 'Power surges': 0.5 * 20000 = 10000 USD, for 'Human errors': 0.9 * 3000 = 2700 USD, for 'System security': 0.4 * 16000 = 6400 USD. The highest expected impact is from 'Power surges' at 10000 USD.
Make a new list with the Probability of occurrence * Cost of impact and select the highest, that will be 10,000 for Power Surge.
D- power surge Impact times probably and you get 10000 for power surge