Which one of these formulas is used in Quantitative risk analysis?

The formula used in quantitative risk analysis that is most relevant in this context is Single Loss Expectancy (SLE). SLE is a critical measurement in risk management because it quantifies the potential loss in monetary terms for a single occurrence of risk. The formula for SLE is typically expressed as:

SLE = Asset Value x Exposure Factor.

Here, the asset value represents the worth of the asset, and the exposure factor is the percentage of loss that would be incurred if the risk were to materialize. By calculating SLE, organizations can assess the financial impact of risks and prioritize their risk management efforts based on the expected losses.

In quantitative risk analysis, it is crucial to express risk in measurable terms to make informed decisions regarding risk mitigation and resource allocation. Other terms like Single Loss Occurrence and Annual Loss Occurrence are relevant but do not provide the same calculative framework that SLE offers. The Annual Rate of Exposure, while it provides insights into the frequency of risk events, does not provide a direct formula for measuring financial loss from a single occurrence. Thus, SLE is central to understanding potential financial downturns in the face of risk.