Which type of risk analysis includes estimating both the probability of occurrence and impact?

Quantitative risk analysis is characterized by its systematic approach to evaluating risks through the use of numerical estimates. This type of analysis involves measuring both the probability of an event occurring and the potential impact it could have on a project or organization. By quantifying these aspects, analysts can derive risk values that enable more precise risk management planning and decision-making.

In quantitative risk analysis, specific metrics and data are utilized to provide a clearer picture of the risks involved. This method allows for the comparison of risks based on their calculated values, facilitating informed choices regarding which risks to mitigate and to what extent. The focus is on numerical analysis and often includes the use of statistical methods to project potential outcomes and to evaluate the effectiveness of different risk response strategies.

In contrast, qualitative risk analysis typically involves subjective assessments of risks based on their likelihood and impact without assigning numerical values. Strategic risk analysis looks at risks that could affect an organization's overall strategy, while operational risk analysis focuses on risks related to the processes and operations within the organization. Each of these has distinct characteristics that do not incorporate the detailed measurement approach found in quantitative risk analysis.