What does ALE stand for in risk assessment?

Prepare for the Network Security (NETSEC) 2 Exam. Utilize flashcards and multiple choice questions, complete with hints and detailed explanations. Excel in your security skills!

Multiple Choice

What does ALE stand for in risk assessment?

Explanation:
Annualized Loss Expectancy explains the expected monetary loss a system faces each year from a specific threat. It combines how much you would lose in a single incident (Single Loss Expectancy) with how often that incident is expected to occur in a year (Annualized Rate of Occurrence). For example, if an asset is worth $100,000 and a single incident could cause $50,000 in damage (SLE), and you expect two such incidents per year (ARO = 2), the ALE would be $100,000 per year. This figure helps prioritize risk mitigation: if a control reduces the annual loss by more than its yearly cost, it’s worth implementing. Other phrasings like Average Loss Expectancy or Annual Loss Evaluation don’t reflect the standard annualized risk metric used in risk assessment.

Annualized Loss Expectancy explains the expected monetary loss a system faces each year from a specific threat. It combines how much you would lose in a single incident (Single Loss Expectancy) with how often that incident is expected to occur in a year (Annualized Rate of Occurrence). For example, if an asset is worth $100,000 and a single incident could cause $50,000 in damage (SLE), and you expect two such incidents per year (ARO = 2), the ALE would be $100,000 per year. This figure helps prioritize risk mitigation: if a control reduces the annual loss by more than its yearly cost, it’s worth implementing. Other phrasings like Average Loss Expectancy or Annual Loss Evaluation don’t reflect the standard annualized risk metric used in risk assessment.

More Multiple Choice Questions
Subscribe

Get the latest from Passetra

You can unsubscribe at any time. Read our privacy policy