The risk manager at a small bank wants to use quantitative analysis to determine the ALE of running a business system at a location which is subject to fires during the year. A risk analyst reports to the risk manager that the asset value of the business system is $120,000 and, based on industry data, the exposure factor to fires is only 20% due to the fire suppression system installed at the site. Fires occur in the area on average every four years. Which of the following is the ALE?

The risk manager at a small bank wants to use quantitative analysis to determine the ALE of running a business system at a location which is subject to fires during the year. A risk analyst reports to the risk manager that the asset value of the business system is $120,000 and, based on industry data, the exposure factor to fires is only 20% due to the fire suppression system installed at the site. Fires occur in the area on average every four years. Which of the following is the ALE?
A . $6,000
B . $24,000
C . $30,000
D . $96,000

View Answer

Answer: A