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The Institute of Asset Management IAM-Certificate Exam - Topic 3 Question 14 Discussion

When assessing risks, which of the following is a valid statement?
E) Risks can be assessed by calculating the product of their probability and consequences
A) Risks can be assessed by calculating the product of their probability and frequency
B) Risks can be assessed by calculating the product of their consequences and occurrence
C) Risks can be assessed by calculating the product of their Mean Time Between Failure and Mean Time To Repair
D) Risks can be assessed by calculating the product of their possibility and Mean Time Between Failure

The Institute of Asset Management IAM-Certificate Exam - Topic 3 Question 14 Discussion

Actual exam question for The Institute of Asset Management's IAM-Certificate exam
Question #: 14
Topic #: 3
[All IAM-Certificate Questions]

When assessing risks, which of the following is a valid statement?

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Suggested Answer: E

Again, the recognized method for risk evaluation aligns with ISO 31000 and ISO 55000:

Risk = Probability Consequence

This is used across risk matrices, risk registers, and decision frameworks.

Exact Extract from IAM -- Risk Management in Asset Management:

''The basic formula for quantifying risk is: Risk = Likelihood Consequence.''


by Merilyn at Aug 13, 2026, 08:47 PM

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