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In this paper, the authors present a risk classification scheme for software projects that utilizes the dependence of risk events to occur on other risk events and the statistical dependence of impacts of risk events. The proposed risk classification scheme helps to avoid the under and over estimations of the overall impact of dependent risk events. Further, the proposed risk classification scheme protects against under and over counting of the impacts of statistically dependent risk events of software projects. The proposed risk classification scheme utilizes the Software Engineering Institute's risk taxonomy and shows that different classes of the risk taxonomy are independent having statistically independent impacts while different attributes of a taxonomy class are independent having statistically dependent risk impacts.
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