Mathematics · Financial Risk Assessment
A bank is evaluating the risk of a potential data breach. The Single Loss Expectancy (SLE) is estimated at 20 Crore Rupees. The Annual Rate of Occurrence (ARO) is estimated at 0.05. The cost of a new security control that reduces the risk by 90% is 50 Lakh Rupees per year. Calculate the Annualized Loss Expectancy (ALE) and the net financial benefit of implementing this control.
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1ALE is 50 Lakh; Net Benefit is 0.
- 2ALE is 5 Crore; Net Benefit is 4.5 Crore Rupees.
- 3ALE is 1 Crore; Net Benefit is 50 Lakh Rupees.
- 4ALE is 1 Crore; Net Benefit is 40 Lakh Rupees.✓
Correct answer
ALE is 1 Crore; Net Benefit is 40 Lakh Rupees.
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