Answer (C) is correct . Risk avoidance is bringing to an end the activity from which the risk arises. For instance, the risk of having a pipeline sabotaged in an unstable region can be avoided by simply selling the pipeline.
Answer (A) is incorrect because Risk exploitation is the deliberate courting of risk in order to pursue a high return on investment. The building’s purchasers are engaging in risk exploitation.
Answer (B) is incorrect because Risk transfer, synonymous with risk sharing, is the offloading of some loss potential to another party. Common examples are the purchase of insurance policies, engaging in hedging operations, and entering into joint ventures.
Answer (D) is incorrect because Risk reduction (mitigation) is the act of lowering the level of risk associated with an activity. For instance, the risk of systems penetration can be reduced by maintaining a robust information security function within the organization.
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