Estimated Frequency of Threat Occurrence

D.

The correct answer is D. Annualized Rate of Occurrence (ARO).

Risk management involves identifying, assessing, and mitigating risks to an organization's assets, including its information systems. One critical aspect of risk management is estimating the likelihood or probability of a threat occurring. The Annualized Rate of Occurrence (ARO) is the term that represents the estimated frequency at which a threat is expected to occur in a given period, typically one year.

ARO is an essential component of the quantitative risk assessment process, which involves assigning numerical values to the likelihood of a threat and its potential impact. By estimating the ARO, security professionals can determine the expected frequency of a specific threat and use this information to calculate the expected loss associated with the threat.

For example, suppose a company has identified a threat of a data breach due to a phishing attack. The security team estimates that the ARO for this threat is once every six months. If the potential loss from a data breach is $100,000, the expected loss per year would be $200,000 (two breaches per year multiplied by $100,000 per breach).

In contrast, safeguard refers to measures or controls put in place to protect assets from identified risks. Single Loss Expectancy (SLE) is the expected monetary loss associated with a single occurrence of a threat. Exposure Factor (EF) is the percentage of asset loss that would occur if a threat is realized.