Difference between Risk and Uncertainty

Difference between Risk and Uncertainty
Risk vs. Uncertainty
Risk and uncertainty are some of many pairs of words that are often presumed to be synonyms when they are different across various dimensions. According to Zichella (2015), risk refers to the possibility of a bad occurrence taking place and causing the actual results of an organization to deviate from what was targeted. On the other hand, uncertainty is the absence of certainty about a specific event. Risk is measurable, and models that use historical data to assess risk exist, but uncertainty cannot be measured (Loch et al., 2020). The risk-return tradeoff implies that higher risks lead to higher profits, different from uncertainty since it is inversely proportional to possible profits. Also, potential outcomes of risk are known, while those of uncertainty are not.
Differences between Risk and Uncertainty
Comparison basis

Risk

Uncertainty

Meaning

Probability of bad occurrence

Lack of certainty about an event

Ascertainment

It is measurable

Not meas...