Risk Management Stack Flashcards
1
Q
What is needed to attain risk measurement?
A
Accurate modeling
2
Q
Prediction
A
Concrete statement about what will and will not happen.
3
Q
Statement of probability
A
Relative likelihood of a given outcome.
4
Q
Does FAIR use prediction or probabilities?
A
Probabilities.
Making probabilistic statements about what might happen.
5
Q
Probable vs. possible
A
FAIR cares about probable. Anything is possible but not probable.
6
Q
Subjective vs. Objective
A
Subjective is based on feelings. Objective is based on data (as much as reasonably available).
Subjectivity can never be eliminated.
7
Q
Accuracy vs. Precision
A
Better to give accurate range than a precise range that could be wrong.
8
Q
How accurate should estimates be?
A
Accurate with a useful level of precision.
