CRISC Information Technology and Security Practice Question
A risk manager is using the FAIR model to quantify cyber risk. After analyzing a ransomware scenario, the probable loss event frequency (LEF) is estimated at 0.2 per year, and the probable loss magnitude (LM) is $5 million. What is the annualized loss expectancy (ALE) in this scenario?
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
✓
$1,000,000
ALE = LEF * LM = 0.2 * $5,000,000 = $1,000,000.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
$500,000
Why it's wrong here
This would be LEF * 2.5 million, incorrect.
- ✗
$250,000
Why it's wrong here
This is half of the correct ALE, possibly from using 0.05 frequency.
- ✗
$5,000,000
Why it's wrong here
This is the loss magnitude, not adjusted for frequency.
- ✓
$1,000,000
Why this is correct
Correct calculation: 0.2 * 5,000,000 = 1,000,000.
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Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
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