Lesson
5

Risk deduction

Success Problem

Risk deduction is the the sum of the expected values of the risks for the given variant of the project realization (Provided that all variants are independent and can arise all together).

Impact

Risk impacts are negative and form a part of the project cost. If the impacts of individual risks are in different measurement units, it is neccessary to transform all of them to one unified punctual scale.

Recommendation

The greater the risk deduction, the greater is the risk deduction for the given project variant. The risk deduction can have different values for different project realization variants. The greater is the dispersion of the risk deductions for the individual variants, the more risky is the project realization. It is possible to define similarly the project opportunity premium.

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