Read the following scenario and then answer the questions that follow.

You determine that the risk of your new product failing is 40 percent. The immediate cost of that loss is the amount spent in product development and early marketing efforts. You estimate that cost at $300,000 (this does not include the loss of future sales or opportunity costs). In terms of the importance of the risk to the company, you assign a weight of 85 percent on a scale of 1 to 100 percent, indicating a serious loss to the company.

What is the overall risk cost to the company? (P C S)

How will knowing the overall risk help you?