CAS-003 · Question #122
An accountant at a small business is trying to understand the value of a server to determine if the business can afford to buy another server for DR. The risk manager only provided the accountant…
The correct answer is C. $96,000. The annualized loss expectancy (ALE) is the product of the annual rate of occurrence (ARO) and the single loss expectancy (SLE). It is mathematically expressed as: ALE = ARO x SLE Single Loss Expectancy (SLE) is mathematically expressed as: Asset value (AV) x Exposure Thus if…
Question
An accountant at a small business is trying to understand the value of a server to determine if the business can afford to buy another server for DR. The risk manager only provided the accountant with the SLE of $24,000, ARO of 20% and the exposure factor of 25%. Which of the following is the correct asset value calculated by the accountant?
Options
- A$4,800
- B$24,000
- C$96,000
- D$120,000
How the community answered
(23 responses)- A13% (3)
- B4% (1)
- C78% (18)
- D4% (1)
Explanation
The annualized loss expectancy (ALE) is the product of the annual rate of occurrence (ARO) and the single loss expectancy (SLE). It is mathematically expressed as: ALE = ARO x SLE Single Loss Expectancy (SLE) is mathematically expressed as: Asset value (AV) x Exposure Thus if SLE = $ 24,000 and EF = 25% then the Asset value is SLE/EF = $ 96,000
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