TSSA Elevating Practice Test & Exam Prep | Canada

In the context of Risk Management, what does 'Risk Appetite' refer to?

The total impact of a risk event if it occurs The amount and type of risk that an organisation is willing to pursue or retain The process of eliminating all potential risks to the business The minimum risk an organisation can bear before facing insolvency

Correct Answer:

The amount and type of risk that an organisation is willing to pursue or retain

Explanation:

Risk appetite is defined as the amount and type of risk an organisation is willing to accept in pursuit of its strategic objectives.

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