Letter A is the correct answer.
We use risk tolerance in order to help allocate the risk levels on determined activity or work package. The team ranks the project risks by studying the risk tolerances. Thus, when we learn the stakeholders tolerances, it becomes easier for us to have an idea of how they will react to different situations and risky events.
Risk tolerances are determined in order to help the team rank the project risks.
Risk tolerance refers to the amount of loss an investor is ready to handle while making an investment decision. There are several factors which determines the level of risk an investor can afford to take.
Its always better for an investor to know the risk tolerance level as it helps investors plan their entire portfolio and this will drive how they invest. For instance, if an individual’s risk tolerance is low, investments will be made accordingly and also it will include more low-risk investments and less high-risk investments.
Risk tolerance is used in order to help allocate the risk levels on determined activity. By studying the risk tolerances, the team ranks the project risks.
Hence, option A is correct.
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