Which statement best distinguishes qualitative risk analysis from quantitative risk analysis?

Which statement best distinguishes qualitative risk analysis from quantitative risk analysis?

• A. Qualitative risk analysis uses Monte Carlo simulations.
• B. Quantitative risk analysis uses probability/impact scoring.
• C. Qualitative risk analysis relies on numerical models for probabilities and impacts.
• D. Qualitative risk analysis uses subjective assessments like probability/impact and risk matrices; quantitative uses numerical models like Monte Carlo and decision trees.

Answer: (D)

Qualitative risk analysis relies on subjective judgments and relative rankings rather than precise numbers. It uses probability/impact ratings on simple scales and tools like risk matrices to categorize and prioritize risks. Quantitative risk analysis, on the other hand, assigns probability distributions to uncertain factors and applies numerical models—such as Monte Carlo simulations and decision trees—to estimate potential outcomes in numeric terms (like expected cost or schedule impact). This combination—subjective probability/impact assessments with risk matrices for qualitative analysis versus numerical models for quantitative analysis—best captures the difference.

Qualitative risk analysis relies on subjective judgments and relative rankings rather than precise numbers. It uses probability/impact ratings on simple scales and tools like risk matrices to categorize and prioritize risks. Quantitative risk analysis, on the other hand, assigns probability distributions to uncertain factors and applies numerical models—such as Monte Carlo simulations and decision trees—to estimate potential outcomes in numeric terms (like expected cost or schedule impact). This combination—subjective probability/impact assessments with risk matrices for qualitative analysis versus numerical models for quantitative analysis—best captures the difference.