What is the difference between qualitative risk analysis and quantitative risk analysis?

• A. Qualitative risk analysis uses probability/impact scales; quantitative uses numerical models to estimate overall risk exposure
• B. Quantitative risk analysis uses probability/impact scales; qualitative uses numerical models
• C. Qualitative risk analysis uses numerical models to estimate risk exposure
• D. Quantitative risk analysis uses probability/impact scales; qualitative uses numerical models to estimate overall risk exposure

Answer: (D)

The difference lies in how risk is assessed and what kind of result is produced. Qualitative risk analysis uses subjective judgments about likelihood and impact, typically rated on simple scales (for example, low/medium/high) to prioritize risks and decide where to focus attention. It’s quick and helps teams screen many risks without needing detailed data.

Quantitative risk analysis, on the other hand, uses numerical data and mathematical models to estimate risk exposure. It translates probabilities and impacts into numerical outputs—such as expected monetary value, time or cost ranges, and probability distributions—often using tools like simulations. This approach provides a more precise, data-driven picture of how risk could affect project objectives.

So, qualitative analysis uses probability/impact scales to rank risks, while quantitative analysis uses numerical models to estimate overall risk exposure.