Exam CRISC topic 1 question 385 discussion

Actual exam question from Isaca's CRISC

Question #: 385
Topic #: 1

You are the project manager of the NHQ project in Bluewell Inc. The project has an asset valued at $200,000 and is subjected to an exposure factor of 45 percent.
If the annual rate of occurrence of loss in this project is once a month, then what will be the Annual Loss Expectancy (ALE) of the project?

A. $ 2,160,000
B. $ 95,000
C. $ 108,000
D. $ 90,000

Show Suggested Answer

Suggested Answer: C 🗳️
The ALE of this project will be $ 108,000.
Single Loss Expectancy is a term related to Quantitative Risk Assessment. It can be defined as the monetary value expected from the occurrence of a risk on an asset. It is mathematically expressed as follows:
SLE = Asset value * Exposure factor
Therefore,

SLE = 200,000 * 0.45 -
= $ 90,000
As the loss is occurring once every month, therefore ARO is 12. Now ALE can be calculated as follows:

ALE = SLE * ARO -
= 90,000 * 12
= $ 108,000

by theApostle at Nov. 7, 2019, 10:01 p.m.

Comments

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theApostle

Highly Voted 3 years, 8 months ago

The answer is $1,080,000.00 NOT $108,000.00

upvoted 14 times

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Fdzmah

Highly Voted 3 years, 2 months ago

I don't understand how this question is used on every single test bank- Examtopics, Cert Bus, Course Hero... And not one has actually caught/taken the time to correct.

upvoted 7 times

Rooks

2 years, 10 months ago

Copy / paste I guess :-)

upvoted 4 times

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mraiyan

Most Recent 1 month, 1 week ago

if it is hard to adjust the answer to be #$ 1,080,000.00; then adjust the asset value in the question to be $20,000.00 :-)

upvoted 3 times

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