What two factors can be used to determine the level of risk in a project?

Determining the level of risk in a project involves assessing two primary factors: likelihood and impact. Likelihood refers to the probability that a risk event will occur, and impact measures the potential consequences or severity of that event if it does occur.

When these two factors are evaluated together, project managers and stakeholders can prioritize risks effectively. For instance, a risk that has a high likelihood of occurring but a low impact may be treated differently than a risk with a low likelihood but high impact. This approach allows teams to focus on risks that could significantly affect project outcomes and make informed decisions about resource allocation and risk mitigation strategies.

By using likelihood and impact as parameters, teams can create a structured risk assessment process, ensuring that they are not only identifying risks but also understanding their potential effect on the project’s success. This is foundational in risk management practices within software testing and development.