CRISC IT Risk Assessment Practice Question
A company is assessing the risk of a ransomware attack. The security team estimates the threat event frequency as 2 attacks per year, vulnerability as 0.3 (30% chance of success), primary loss as $500,000, and secondary loss as $200,000. What is the annualized loss expectancy (ALE) using the FAIR framework?
⚠ Common exam trap
The trap here is that candidates often forget to multiply by the vulnerability factor (0.3) or omit secondary loss, leading to answers like $700,000 or $1,400,000, which ignore the probabilistic nature of successful attacks.
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
$420,000
The FAIR framework calculates ALE as Threat Event Frequency × Vulnerability × (Primary Loss + Secondary Loss). Here, 2 × 0.3 × ($500,000 + $200,000) = 2 × 0.3 × $700,000 = $420,000. This correctly accounts for the probability of a successful attack and the total loss per incident.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
$420,000
Why this is correct
ALE = (2 * 0.3) * ($500,000 + $200,000) = 0.6 * $700,000 = $420,000.
- ✗
$700,000
Why it's wrong here
This is the total loss magnitude, not the annualized loss.
- ✗
$210,000
Why it's wrong here
This might result from only using primary loss or incorrect multiplication.
- ✗
$1,400,000
Why it's wrong here
This might result from ignoring vulnerability or doubling the loss.
Go deeper
Related to this question
About these practice questions
One of 983 original CRISC practice questions on Courseiva, each with a full explanation and wrong-answer analysis — not exam dumps or protected exam content. Learn why practice questions differ from exam dumps →
JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This CRISC practice question is part of Courseiva's free ISACA certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the CRISC exam.