The correct choice indicates that the difference between inherent risk and residual risk must be greater than the cost of implementing a control measure. In risk management, inherent risk refers to the level of risk that exists in the absence of any controls, while residual risk is the amount of risk that remains after controls are put in place.
When deciding whether to implement a control measure, it is crucial to assess its effectiveness in reducing the inherent risk to an acceptable level defined by the residual risk. If the cost of implementing the control is higher than the benefits gained from the reduced risk (measured as the difference between inherent and residual risk), it would not be a financially sound decision. Therefore, the expected mitigation of risk must provide a significant enough benefit, justifying the costs involved in implementing the control measures.
In contrast, the other options do not directly relate to this fundamental aspect of risk management. The potential for employee lawsuits and total business operating costs are important factors to consider in a broader risk assessment context, but they don't specifically address the relationship between the costs of controls and the risks they are meant to mitigate. Similarly, the expected revenue increase from risk-taking pertains more to business strategy and risk appetite rather than the basic financial justification for implementing control measures against risks.