Associate PRM Practice Questions - PRMIA Associate Professional Risk Manager Certificate Exam

Which of the following BEST distinguishes 'risk' from 'uncertainty'?

Risk and uncertainty are interchangeable terms in modern risk management Risk involves outcomes whose probabilities can be estimated; uncertainty involves outcomes whose probabilities cannot be quantified Risk only refers to negative outcomes; uncertainty only refers to positive outcomes Risk is always insurable; uncertainty is always uninsurable

Correct Answer:

Risk involves outcomes whose probabilities can be estimated; uncertainty involves outcomes whose probabilities cannot be quantified

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