312-50V10 · Question #486
The chance of a hard drive failure is known to be once every four years. The cost of a new hard drive is $500. EF (Exposure Factor) is about 0.5. Calculate for the Annualized Loss Expectancy (ALE).
The correct answer is A. $62.5. ALE is calculated as SLE multiplied by ARO. With an asset value of $500, an EF of 0.5, and a failure rate of once every four years, the result is $62.50.
Question
The chance of a hard drive failure is known to be once every four years. The cost of a new hard drive is $500. EF (Exposure Factor) is about 0.5. Calculate for the Annualized Loss Expectancy (ALE).
Options
- A$62.5
- B$250
- C$125
- D$65.2
How the community answered
(31 responses)- A81% (25)
- B3% (1)
- C6% (2)
- D10% (3)
Why each option
ALE is calculated as SLE multiplied by ARO. With an asset value of $500, an EF of 0.5, and a failure rate of once every four years, the result is $62.50.
SLE (Single Loss Expectancy) equals asset value times EF: $500 x 0.5 = $250. ARO (Annualized Rate of Occurrence) equals 1 divided by the recurrence period in years: 1/4 = 0.25. ALE = SLE x ARO = $250 x 0.25 = $62.50, matching this answer exactly.
$250 represents only the SLE (asset value x EF) and omits dividing by the four-year recurrence period to annualize the figure.
$125 results from incorrectly using an ARO of 0.5 (once every two years) instead of the stated once every four years (0.25).
$65.2 does not correspond to any correct application of the ALE formula using the values provided.
Concept tested: Annualized Loss Expectancy (ALE) calculation
Source: https://csrc.nist.gov/publications/detail/sp/800-30/rev-1/final
Topics
Community Discussion
No community discussion yet for this question.