Define the concept of risk, emphasizing its role as the intersection of threats and vulnerabilities, leading to potential losses.

Analyze the key components of risk:

Threats: Malicious actors, events, or conditions that can exploit vulnerabilities.

Vulnerabilities: Weaknesses in systems, processes, or resources that expose them to threats.

Losses: Potential harm to business functions, assets, or reputation resulting from a realized risk.

Discuss the impact of risk on business costs, emphasizing the importance of proactive risk management in minimizing financial losses and ensuring operational continuity.