CSSLP · Question #241
How can you calculate the Annualized Loss Expectancy (ALE) that may occur due to a threat?
The correct answer is A. Single Loss Expectancy (SLE) X Annualized Rate of Occurrence (ARO). Annualized Loss Expectancy (ALE) is calculated by multiplying the Single Loss Expectancy (SLE), which is the monetary loss from a single event, by the Annualized Rate of Occurrence (ARO), which is how often the event is expected to occur in a year.
Question
How can you calculate the Annualized Loss Expectancy (ALE) that may occur due to a threat?
Options
- ASingle Loss Expectancy (SLE) X Annualized Rate of Occurrence (ARO)
- BSingle Loss Expectancy (SLE)/ Exposure Factor (EF)
- CAsset Value X Exposure Factor (EF)
- DExposure Factor (EF)/Single Loss Expectancy (SLE)
How the community answered
(41 responses)- A90% (37)
- B2% (1)
- C5% (2)
- D2% (1)
Why each option
Annualized Loss Expectancy (ALE) is calculated by multiplying the Single Loss Expectancy (SLE), which is the monetary loss from a single event, by the Annualized Rate of Occurrence (ARO), which is how often the event is expected to occur in a year.
The formula for Annualized Loss Expectancy (ALE) is indeed Single Loss Expectancy (SLE) multiplied by the Annualized Rate of Occurrence (ARO), providing an estimated annual financial cost of a specific risk.
Single Loss Expectancy (SLE) divided by Exposure Factor (EF) is not a standard formula for risk assessment; SLE is typically calculated as Asset Value (AV) x Exposure Factor (EF).
Asset Value (AV) multiplied by Exposure Factor (EF) calculates the Single Loss Expectancy (SLE), not the Annualized Loss Expectancy (ALE).
Exposure Factor (EF) divided by Single Loss Expectancy (SLE) is not a recognized formula in risk assessment.
Concept tested: Quantitative risk assessment - ALE calculation
Source: https://nvlpubs.nist.gov/nistpubs/Legacy/SP/nistspecialpublication800-30r1.pdf
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