- A
$5,000
Why wrong: That is the SLE, not ALE.
- B
$10,000
Why wrong: Incorrect multiplication.
- C
$25,000
Why wrong: That would be SLE/ARO, not product.
- D
$1,000
Correct calculation: 5000 * 0.2 = 1000.
Question 402 of 1,000
SSCP Risk Identification, Monitoring, and Analysis Practice Question
This SSCP practice question tests your understanding of risk identification, monitoring, and analysis. 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.
An organization calculates the SLE for a server as $5,000 and the ARO as 0.2. What is the ALE?
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). Given SLE = $5,000 and ARO = 0.2, the ALE is $5,000 × 0.2 = $1,000. This is the expected annual financial loss from the server risk.
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.
- ✗
$5,000
Why it's wrong here
That is the SLE, not ALE.
- ✗
$10,000
Why it's wrong here
Incorrect multiplication.
- ✗
$25,000
Why it's wrong here
That would be SLE/ARO, not product.
- ✓
$1,000
Why this is correct
Correct calculation: 5000 * 0.2 = 1000.
Related concept
Read the scenario before looking for a memorised answer.
Common exam traps
Common exam trap: answer the scenario, not the keyword
The trap here is that candidates often multiply SLE by the reciprocal of ARO (e.g., 5 instead of 0.2) or confuse ARO with a percentage, leading to an inflated ALE like $25,000.
Detailed technical explanation
How to think about this question
The ALE formula (SLE × ARO) is a core quantitative risk analysis method defined in NIST SP 800-30. The ARO of 0.2 indicates the event is expected to occur once every five years, so the annualized cost is one-fifth of the single loss. In practice, this helps prioritize mitigation investments; if a control costs less than $1,000 per year, it is cost-justified.
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 security analyst at a medium-sized enterprise encounters this scenario during an investigation or architecture review. The correct answer reflects best practice for the specific threat or control described. Answer the scenario, not the keyword: identify the specific constraint before choosing the most familiar-sounding option. Security exam questions test whether you can match controls to threats in context — not just recall definitions.
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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FAQ
Questions learners often ask
What does this SSCP question test?
Risk Identification, Monitoring, and Analysis — This question tests Risk Identification, Monitoring, and Analysis — Read the scenario before looking for a memorised answer..
What is the correct answer to this question?
The correct answer is: $1,000 — The Annualized Loss Expectancy (ALE) is calculated by multiplying the Single Loss Expectancy (SLE) by the Annualized Rate of Occurrence (ARO). Given SLE = $5,000 and ARO = 0.2, the ALE is $5,000 × 0.2 = $1,000. This is the expected annual financial loss from the server risk.
What should I do if I get this SSCP 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 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.
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