QuestionQ92

VerifiedRisk Management

Risk transference refers to shifting risks to a third party, usually for a fee. It establishes a contractual relationship in which the third party manages the risk on behalf of the performing organization. Which of the following is NOT an example of a risk-transference response?

Explanation

Life cycle costing is a financial analysis technique used to assess the total cost of ownership over an asset’s or project’s full life. It does not establish a contractual arrangement that shifts responsibility for a risk to a third party.

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