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SSCP Practice Question: A risk manager is calculating the annualized loss…
A risk manager is calculating the annualized loss expectancy (ALE) for a server. The single loss expectancy (SLE) is $5,000 and the annualized rate of occurrence (ARO) is 0.2. What is the ALE?
⚠ Common exam trap
A common mix-up: candidates confuse the ALE formula by dividing SLE by ARO instead of multiplying, leading to the inflated $25,000 figure in option A.
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
The annualized loss expectancy (ALE) is calculated by multiplying the single loss expectancy (SLE) by the annualized rate of occurrence (ARO). Here, SLE = $5,000 and ARO = 0.2, so ALE = $5,000 × 0.2 = $1,000. This represents the expected annual financial loss from the server risk.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
$25,000
Why it's wrong here
Incorrect multiplication.
- ✓
$1,000
Why this is correct
Correct calculation.
- ✗
$5,000
Why it's wrong here
That is the SLE, not ALE.
- ✗
$100
Why it's wrong here
Incorrect multiplication.
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JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This SSCP practice question is part of Courseiva's free ISC2 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 SSCP exam.