CRISC Risk Response and Reporting Practice Question
The risk team is evaluating the cost-effectiveness of a proposed control that will reduce the annualized loss expectancy (ALE) for a cyber attack from $500,000 to $100,000. The annual cost of the control is $150,000. What is the net benefit of implementing this control?
⚠ Common exam trap
CRISC often tests whether candidates confuse the gross risk reduction (ALE before minus ALE after) with the net benefit, which requires subtracting the control's annual 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 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 $150,000 annual control cost gives a net benefit of $250,000.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
$400,000
Why it's wrong here
$400,000 is the ALE reduction (500,000 minus 100,000), ignoring the $150,000 control cost. It is tempting because it captures the control's gross risk-reduction value, which is the correct figure when asked for risk mitigated rather than net benefit. Net benefit subtracts the annual control cost.
- ✓
$250,000
Why this is correct
The control lowers annualised loss expectancy by $400,000 ($500,000 − $100,000), then deducts the $150,000 annual cost, giving a net benefit of $250,000. This directly satisfies the stem's cost-effectiveness constraint by quantifying residual risk reduction against control expenditure.
- ✗
$150,000
Why it's wrong here
$150,000 is the annual control cost, not the net benefit. It is tempting because that figure is stated directly in the stem and represents the investment being weighed, but net benefit requires subtracting it from the $400,000 ALE reduction, giving $250,000.
- ✗
$350,000
Why it's wrong here
$350,000 subtracts only $150,000 from the $500,000 original ALE, treating the residual $100,000 as if eliminated. It is tempting because it uses both stem figures, but the correct net benefit is the $400,000 ALE reduction minus the $150,000 control cost, equalling $250,000.
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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.