Annualized Loss Expectancy (ALE) is calculated as Single Loss Expectancy (SLE) multiplied by Annual Rate of Occurrence (ARO): $ALE = _____ \times ARO$.
Answer
SLE
Explanation
### Why this is right
The stated formula is $ALE = SLE \times ARO$. The blank is the loss estimate for a single occurrence, which is multiplied by the annual occurrence rate to estimate annualized loss.
### The concept
Single Loss Expectancy estimates loss from one event. Annual Rate of Occurrence estimates how often the event is expected to occur in a year. Their product is Annualized Loss Expectancy, a yearly loss estimate based on those inputs.
### Terms
- **ALE**: Annualized Loss Expectancy, an estimate of loss over a year.
- **SLE**: Single Loss Expectancy, an estimate of loss from one occurrence.
- **ARO**: Annual Rate of Occurrence, an estimate of how often an event occurs per year.
### Remember
Annualized loss equals per-event loss times annual occurrence rate.
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