If SLE is $275 and ARO is 0.2, what is ALE?

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Multiple Choice

If SLE is $275 and ARO is 0.2, what is ALE?

Explanation:
ALE is found by multiplying the Single Loss Expectancy by the Annualized Rate of Occurrence. With a loss per incident of $275 and an expected 0.2 incidents per year, the calculation is 275 × 0.2 = 55. This means the expected annual loss is $55 per year. The other options would come from misapplying one of the factors or using only one value (for example, using the loss per incident alone or misinterpreting the frequency).

ALE is found by multiplying the Single Loss Expectancy by the Annualized Rate of Occurrence. With a loss per incident of $275 and an expected 0.2 incidents per year, the calculation is 275 × 0.2 = 55. This means the expected annual loss is $55 per year. The other options would come from misapplying one of the factors or using only one value (for example, using the loss per incident alone or misinterpreting the frequency).

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