What will be the Single Loss Expectancy of the project?

Mark is the project manager of the NHQ project in StarTech Inc. The project has an asset valued
at $195,000 and is subjected to an exposure factor of 35 percent. What will be the Single Loss
Expectancy of the project?

A.
$68,250

B.
$92,600

C.
$72,650

D.
$67,250

Explanation:
The Single Loss Expectancy (SLE) of this project will be $68,250. Single Loss
Expectancy is a term related to Risk Management and Risk Assessment. It can be defined as the
monetary value expected from the occurrence of a risk on an asset. It is mathematically expressed

as follows: Single Loss Expectancy (SLE) = Asset Value (AV) * Exposure Factor (EF) where the
Exposure Factor is represented in the impact of the risk over the asset, or percentage of asset
lost. As an example, if the Asset Value is reduced two thirds, the exposure factor value is .66. If
the asset is completely lost, the Exposure Factor is 1.0. The result is a monetary value in the same
unit as the Single Loss Expectancy is expressed. Here, it is as follows:
SLE = Asset Value * Exposure Factor
= 195,000 * 0.35
= $68,250