Risk Flashcards
Objective risk
depends on how likely some negative event is likely to occur
Subjective Risk
depends on what you believe of the world
Subjective Risks are still
relevant
Risk-benefit principle
Quantitatively weigh the benefits of risk against the cost
Precautionary Principle
Numbers required for risk-benefit analysis are unreliable (Better safe than sorry)
Calculating expected value
Multiply probability of each outcome with the value of each outcome and adding them together
dominant principle of risk analysis in Europe
precautionary principle
criticisms of risk-benefit principle
- data is unreliable
2. does not include reasonable considerations about risk-aversion
Allais Paradox
the principle of maximizing expected value calls for people to make counterintuitive choices
There is no universal definition of the ___
precautionary principle
Precautionary principle sometimes stresses the importance of choosing a ___ response to a threat
cost-effective
Wingspread Statement
precautionary measures should be take even if some cause-effect relationships are not scientifically established
Critics of Precautionary Principle argue
- Some subjective threats are later disproven
- It is too vague
- Overly rigid
No risk principle is better than another (T/F)
T
Instead of calculating probabilities, engineers employing the precautionary principle need only establish whether a sufficiently bad outcome will definitely occur unless some precautionary measure is taken (T/F)
False
