CFA Institute Sustainable-Investing Question Answer
Which of the following is an example of a stranded asset?
A.
A coal power plant forced to close due to new carbon regulations
B.
A technology company that loses market share to a competitor
C.
A stock that experiences a short-term price decline
The Answer Is:
A
This question includes an explanation.
Explanation:
A coal power plant forced to close due to carbon regulationsis astranded asset, as it loses economic value due toregulatory, environmental, or market changes.
A tech company losing market share (B) is a business risk, not asset stranding.
Short-term stock price declines (C) are normal market fluctuations.
[References:, Carbon Tracker Initiative Stranded Assets Report, CFA Institute ESG Climate Risk Framework, World Bank Energy Transition & Asset Risk Guide, ========, , ]
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