CRISC Risk Response and Reporting Practice Question
A company is evaluating the cost-benefit of a new control that reduces the annualized loss expectancy (ALE) from $500,000 to $100,000. The control has an annual cost of $150,000. What is the net benefit of implementing this control?
⚠ Common exam trap
The trap here is that candidates often forget to subtract the annual control cost from the ALE reduction, mistakenly selecting the gross reduction ($400,000) as the net benefit, or they incorrectly subtract the residual ALE instead of the control cost.
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
✓
$250,000
The net benefit of implementing a control is calculated as the reduction in Annualized Loss Expectancy (ALE) minus the annual cost of the control. The ALE reduction is $500,000 - $100,000 = $400,000. Subtracting the annual control cost of $150,000 yields a net benefit of $250,000, making option B correct.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
$350,000
Why it's wrong here
Incorrect; this may be the reduction in ALE without subtracting control cost.
- ✓
$250,000
Why this is correct
Correct calculation: ALE reduction of $400,000 minus control cost of $150,000 equals $250,000 net benefit.
- ✗
$400,000
Why it's wrong here
This is the ALE reduction, not net benefit.
- ✗
$50,000
Why it's wrong here
Incorrect; this may be the residual ALE minus control cost or other miscalculation.
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.