Risks in projects are evaluated based on which two key factors?

Risks in projects are primarily evaluated based on likelihood and impact because these two factors provide a comprehensive framework for understanding the potential effects of risks on project objectives.

Likelihood refers to the probability that a particular risk event will occur. Evaluating this factor helps project managers prioritize risks based on how likely they are to happen, enabling them to focus their mitigation efforts on the most probable risks that could disrupt the project's success.

Impact, on the other hand, assesses the potential consequences or effects that a risk will have on the project if it does occur. This can include implications for cost, time, quality, and overall project performance. By understanding the impact, project managers can determine just how serious a risk is and develop appropriate response strategies.

Together, analyzing both likelihood and impact allows project managers to create a risk matrix or register that categorizes risks based on their severity, enabling a more informed decision-making process regarding which risks to address proactively and how to allocate resources effectively in risk management. The other factors listed, while important in different contexts, do not directly inform the risk evaluation process in the same way.