AllOnline Company is an e-business providing goods and services online to their customers. Their web-portal generates about $20000 in sales. The CIO of AllOnline has estimated that if the system were to fail, the average downtime would be about 2 hours per incident. It is anticipated (assume with 100% annual probability) that AllOnline will likely experience 5 downtime incidents in a given year due to internal computer system problems. 

Question: 

A preventative control would be purchased to maintain more redundant computers and communication lines where possible, at an annualized cost of $10,000, which would reduce the expected downtime to 1 hour per incident (from 2) . What would the dollar amount of AllOnline’s current residual expected risk at this point be?

Answer rating: 100% (QA)

The current residual expected risk would be 5000 workings 5 downtime in... View the full answer