A cost-benefit analysis is calculated by subtracting the post-control annualized loss expectancy and the ____ from the pre-control loss expectancy
A) annualized cost of the safeguard
B) exposure factor
C) annualized rate of occurrence
D) asset value

Question

Quizplus · Accepted Answer

A cost-benefit analysis involves determining whether the cost of implementing a safeguard (such as installing new security software or hiring additional security staff) is justified by the expected reduction in losses due to security incidents. To calculate the benefit, the post-control annualized loss expectancy (i.e., estimated annual losses after the safeguard has been implemented) is subtracted from the pre-control loss expectancy (i.e., estimated annual losses before the safeguard). The annualized cost of the safeguard is then subtracted from this result to determine the net benefit (i.e., whether the cost of the safeguard is justified by the expected reduction in losses). Therefore, the correct answer is A.

A Cost-Benefit Analysis Is Calculated by Subtracting the Post-Control Annualized