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Exam Code: APC-Written-Exam

Exam Name: Australian Intern Written Exam

Version: V15.35

Q & A: 208 Questions and Answers

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Which of the following is the process of numerically analyzing the effects of identified risks on the overall enterprise's objectives?
A. Monitoring and Controlling Risks
B. Qualitative Risk Assessment
C. Identifying Risks
D. Quantitative Risk Assessment
Answer: D
A quantitative risk assessment quantifies risk in terms of numbers such as dollar values. This involves gathering data and then entering it into standard formulas. The results can help in identifying the priority of risks. These results are also used to determine the effectiveness of controls. Some of the terms associated with quantitative risk assessments are:
Single loss expectancy (SLE)-It refers to the total loss expected from a single incident. This incident

can occur when vulnerability is being exploited by threat. The loss is expressed as a dollar value such as $1,000. It includes the value of data, software, and hardware.
SLE = Asset value * Exposure factor
Annual rate of occurrence (ARO)-It refers to the number of times expected for an incident to occur in a

year. If an incident occurred twice a month in the past year, the ARO is 24. Assuming nothing changes, it is likely that it will occur 24 times next year.
Annual loss expectancy (ALE)-It is the expected loss for a year. ALE is calculated by multiplying SLE

with ARO. Because SLE is a given in a dollar value, ALE is also given in a dollar value. For example, if the SLE is $1,000 and the ARO is 24, the ALE is $24,000. ALE = SLE * ARO Safeguard value-This is the cost of a control. Controls are used to mitigate risk. For example, antivirus

software of an average cost of $50 for each computer. If there are 50 computers, the safeguard value is
Incorrect Answers:
A: The first thing we must do in risk management is to identify the areas of the project where the risks can occur. This is termed as risk identification. Listing all the possible risks is proved to be very productive for the enterprise as we can cure them before it can occur. In risk identification both threats and opportunities are considered, as both carry some level of risk with them.
C: Unlike the quantitative risk assessment, qualitative risk assessment does not assign dollar values.
Rather, it determines risk's level based on the probability and impact of a risk. These values are determined by gathering the opinions of experts.
Probability- establishing the likelihood of occurrence and reoccurrence of specific risks, independently,

and combined. The risk occurs when a threat exploits vulnerability. Scaling is done to define the probability that a risk will occur. The scale can be based on word values such as Low, Medium, or High.
Percentage can also be assigned to these words, like 10% to low and 90% to high.
Impact- Impact is used to identify the magnitude of identified risks. The risk leads to some type of loss.

However, instead of quantifying the loss as a dollar value, an impact assessment could use words such as Low, Medium, or High. Impact is expressed as a relative value. For example, low could be 10, medium could be 50, and high could be 100.
Risk level = Probability*Impact
D: This is the process of implementing risk response plans, tracking identified risks, monitoring residual risks, identifying new risks, and evaluating risk process effectiveness through the project.

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