Quantitative Risk Lab
Adjust variables to calculate financial risk.
Cost to replace
$
% Lost
0% (Safe)
100%
100% (Destroyed)
Times per year
Ex: 0.1 = Once every 10 years. 1.0 = Once a year.
Firewall, Insurance, etc.
$
Step 1: Single Loss Expectancy
AV × EF = SLE
$2,000 × 100% =
$2,000
Cost every single time this happens.
Step 2: Annualized Loss Expectancy
SLE × ARO = ALE
$2,000 × 0.5 =
$1,000
How much this costs us per year, on average.
Step 3: Cost/Benefit Analysis
Annual Risk (ALE): $1,000
Control Cost: $500
+$500
APPROVED: The control saves money.