- A
Recovery time objective (RTO)
Why wrong: RTO is a business continuity metric, not a direct FAIR factor.
- B
Threat event frequency
Threat event frequency is a key component in FAIR for calculating annual loss exposure.
- C
Cost of cyber insurance premium
Why wrong: Insurance premium is a financial transfer, not a risk quantification factor.
- D
Number of affected systems
Why wrong: Number of systems influences loss magnitude, but frequency is also needed.
Question 618 of 1,000
CRISC Information Technology and Security Practice Question
This CRISC practice question tests your understanding of information technology and security. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
A risk manager is calculating the probable financial impact of a ransomware attack using the FAIR model. Which factor is MOST critical to estimate the annual loss exposure?
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
✓
Threat event frequency
In the FAIR model, annual loss exposure (ALE) is calculated as threat event frequency multiplied by probable loss magnitude. Threat event frequency is the most critical factor because it directly drives how often losses occur, and without an accurate estimate of how frequently ransomware attacks are expected, any loss magnitude estimate becomes meaningless for annualizing exposure.
Key principle: Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Recovery time objective (RTO)
Why it's wrong here
RTO is a business continuity metric, not a direct FAIR factor.
- ✓
Threat event frequency
Why this is correct
Threat event frequency is a key component in FAIR for calculating annual loss exposure.
Related concept
Read the scenario before looking for a memorised answer.
- ✗
Cost of cyber insurance premium
Why it's wrong here
Insurance premium is a financial transfer, not a risk quantification factor.
- ✗
Number of affected systems
Why it's wrong here
Number of systems influences loss magnitude, but frequency is also needed.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often confuse loss magnitude factors (like number of affected systems or RTO) with the frequency component, mistakenly thinking that the size of a single incident is more important than how often incidents occur, when in fact both are needed but frequency is the most critical for annualizing exposure.
Detailed technical explanation
How to think about this question
Under the FAIR model, threat event frequency (TEF) is decomposed into contact frequency and probability of action, and it is typically estimated using historical data, industry benchmarks, or threat intelligence feeds (e.g., CISA alerts, Verizon DBIR). A real-world scenario: if a healthcare organization estimates TEF as 2 ransomware attempts per year with a 50% success rate, and loss magnitude per event is $500,000, the annual loss exposure is $500,000; but if TEF is misestimated as 0.2, the exposure drops to $100,000, severely understating risk.
KKey Concepts to Remember
- Read the scenario before looking for a memorised answer.
- Find the constraint that changes the correct option.
- Eliminate answers that are true in general but not in this case.
TExam Day Tips
- Watch for words such as best, first, most likely and least administrative effort.
- Review why wrong options are wrong, not only why the correct option is correct.
Key takeaway
Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option.
Real-world example
How this comes up in practice
A practitioner preparing for the CRISC exam encounters this exact type of scenario on the job. The correct answer here is not the most general option — it is the best answer for the specific constraint described. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Real exam questions reward reading the full scenario before eliminating options, because the constraint defines which answer fits.
What to study next
Got this wrong? Here's your next step.
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
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Information Technology and Security — study guide chapter
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FAQ
Questions learners often ask
What does this CRISC question test?
Information Technology and Security — This question tests Information Technology and Security — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: Threat event frequency — In the FAIR model, annual loss exposure (ALE) is calculated as threat event frequency multiplied by probable loss magnitude. Threat event frequency is the most critical factor because it directly drives how often losses occur, and without an accurate estimate of how frequently ransomware attacks are expected, any loss magnitude estimate becomes meaningless for annualizing exposure.
What should I do if I get this CRISC question wrong?
Identify which exam domain this question belongs to, review the core concept, then practise similar questions from the same domain.
What is the key concept behind this question?
Read the scenario before looking for a memorised answer.
About these practice questions
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Last reviewed: Jul 4, 2026
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.
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