CRISC IT Risk Assessment Practice Question
A hospital's risk team is assessing a clinical imaging archive. The team determines that a ransomware event would encrypt the archive and disrupt diagnostic services, with an estimated single-loss magnitude of $2,000,000. Existing controls reduce the likelihood of a successful attack to an estimated 0.4 occurrences per year. What is the annualized loss expectancy (ALE) for this risk?
⚠ Common exam trap
Many exam-takers confuse single loss expectancy with annualized loss expectancy, or dividing the loss by the frequency instead of multiplying.
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
✓
$800,000
Annualized loss expectancy is the product of the loss from a single event and the estimated number of such events per year. Multiplying the $2,000,000 single-loss magnitude by the 0.4 annualized rate of occurrence yields an expected average annual loss of $800,000, which the hospital can use to compare against the cost of additional ransomware controls.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
$2,000,000
Why it's wrong here
This is the single loss expectancy for one successful ransomware event, not the annualized figure. It ignores the estimated annualized rate of occurrence of 0.4, so it does not reflect that a successful attack is expected less than once per year on average across the archive environment.
- ✗
$2,400,000
Why it's wrong here
This value adds a frequency-weighted increment to the single-loss magnitude rather than multiplying the two factors. It does not correspond to any standard risk formula and overstates the expected annual loss, which would mislead the hospital into over-allocating budget for ransomware controls on the imaging archive.
- ✗
$5,000,000
Why it's wrong here
This figure results from dividing the single-loss magnitude by the annualized rate of occurrence instead of multiplying, which inverts the relationship. Such a calculation would imply that a lower event frequency increases expected annual loss, contradicting the definition of annualized loss expectancy as the product of loss per event and events per year.
- ✓
$800,000
Why this is correct
This is correct because ALE equals single loss expectancy multiplied by annualized rate of occurrence. With a single-loss magnitude of $2,000,000 and an annualized rate of 0.4, the calculation is $2,000,000 × 0.4 = $800,000. This represents the expected average annual loss from ransomware affecting the clinical imaging archive given the stated control effectiveness.
Go deeper
Related to this question
About these practice questions
Courseiva writes every CRISC question from scratch — 1,062 in total, each with an explanation and a wrong-answer breakdown. None are copied from real exams or dumps. Learn why practice questions differ from exam dumps →
JA
Written and reviewed by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
Last reviewed September 2026 · checked against the official ISACA exam blueprint
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.