Strategies for managing risk include:

• A. Risk Avoidance and Risk Acceptance
• B. Risk Transfer and Risk Retention
• C. Risk Acceptance and Risk Denial
• D. Both A and B

Answer: (D)

Managing risk means choosing actions to deal with potential threats. You can eliminate risk by avoiding the activity, or reduce it with good plans and controls. If you can’t avoid or fully reduce it, you can shift the impact to someone else through contracts or insurance (risk transfer). If some risk remains after these steps, you may choose to accept or retain it and plan for it. These options—avoidance, transfer, acceptance, and retention—t cover the practical ways to handle risk. Denying risk isn’t a viable strategy; you still must address it through one of these approaches. That’s why combining the valid strategies of avoidance and transfer/retention provides the most complete approach.