Risk management process · Question 12 of 12
Flood damage to the data center would cost 2 million euros and statistically occurs once in 50 years. What is the ALE?
1 answer is correct. Hard
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Answer
- C 40,000 euros
Explanation
The annualized rate of occurrence (ARO) is 1/50 = 0.02. Multiplied by the single loss of 2 million euros, this gives an ALE of 40,000 euros. A protective measure that costs considerably less per year makes sense in arithmetic terms.