FSA EXAM PART 2 QUESTIONS WITH
VERIFIED ANSWERS
What is the primary challenge that the disclosure of company policies (such as ESG
policies or whistleblower policies) can pose to investment analysis? - Correct Answers -
A. The presence of a company policy is represented through binary data, which does
not provide useful insight into actual company performance
How do trends in index investing influence corporate-investor engagement on
sustainability? - Correct Answers -D. The growth of index investing can encourage
investment stewardship based on how buy-sell decisions are made
Corporate disclosures of sustainability information serve which two of the following
purposes in capital markets? (Choose two) - Correct Answers -A. Aid in valuation for
financial analysts
C. Allow investors to assess risks and opportunities related to their investments
As compared to Company A, how would Company B's performance on energy
management predominantly impact the valuation model? - Correct Answers -C.
Decrease expense projections
How will performance on SASB metrics impact Company A's valuation as compared to
Company B? - Correct Answers -D. Company A's lower voluntary employee turnover
rate will likely increase valuation.
CASE STUDY 2 - TELECOMMUNICATIONS INDUSTRY
Due to the differences in revenue streams, management of which sustainability topic(s)
will likely have more material impacts for Company B than for Company A? - Correct
Answers -D. Recruitment and retention of a diverse workforce
CASE STUDY 2 - TELECOMMUNICATIONS INDUSTRY
When comparing Company A's performance to Company B's, what external factor(s)
provides relevant insight into differences in near-term forecasts for the two companies?
- Correct Answers -B. Growth in emerging markets
The chart below presents examples of business initiatives designed to reflect the
different stages of sustainability-based value creation, as identified by multiple thought
leaders in the field. Select the arrangement of initiatives that progress from early-stage
to late- stage:
1. Incorporate inventory management and procurement processes to supplement
product delivery service
VERIFIED ANSWERS
What is the primary challenge that the disclosure of company policies (such as ESG
policies or whistleblower policies) can pose to investment analysis? - Correct Answers -
A. The presence of a company policy is represented through binary data, which does
not provide useful insight into actual company performance
How do trends in index investing influence corporate-investor engagement on
sustainability? - Correct Answers -D. The growth of index investing can encourage
investment stewardship based on how buy-sell decisions are made
Corporate disclosures of sustainability information serve which two of the following
purposes in capital markets? (Choose two) - Correct Answers -A. Aid in valuation for
financial analysts
C. Allow investors to assess risks and opportunities related to their investments
As compared to Company A, how would Company B's performance on energy
management predominantly impact the valuation model? - Correct Answers -C.
Decrease expense projections
How will performance on SASB metrics impact Company A's valuation as compared to
Company B? - Correct Answers -D. Company A's lower voluntary employee turnover
rate will likely increase valuation.
CASE STUDY 2 - TELECOMMUNICATIONS INDUSTRY
Due to the differences in revenue streams, management of which sustainability topic(s)
will likely have more material impacts for Company B than for Company A? - Correct
Answers -D. Recruitment and retention of a diverse workforce
CASE STUDY 2 - TELECOMMUNICATIONS INDUSTRY
When comparing Company A's performance to Company B's, what external factor(s)
provides relevant insight into differences in near-term forecasts for the two companies?
- Correct Answers -B. Growth in emerging markets
The chart below presents examples of business initiatives designed to reflect the
different stages of sustainability-based value creation, as identified by multiple thought
leaders in the field. Select the arrangement of initiatives that progress from early-stage
to late- stage:
1. Incorporate inventory management and procurement processes to supplement
product delivery service
