CRISC Certified in Risk and Information Systems Control – Question093

Which of the following is described by the definition given below? "It is the expected guaranteed value of taking a risk."

A.
Certainty equivalent value
B. Risk premium
C. Risk value guarantee
D. Certain value assurance

Correct Answer: A

Explanation:

Explanation: The Certainty equivalent value is the expected guaranteed value of taking a risk. It is derived by the uncertainty of the situation and the potential value of the situation’s outcome.
Incorrect Answers:
B: The risk premium is the difference between the larger expected value of the risk and the smaller certainty equivalent value.
D: These are not valid answers.