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A climate resilience consultant prepares an overview for a regional agency client. The overview summarizes climate policies that significantly reduce emissions. The client expresses a strong preference for a policy that limits emissions and offers flexibility in participant permits.

What policy should the consultant recommend to the client?

A.

Feed-in tariffs

B.

Fuel efficiency standards

C.

Carbon tax

D.

Cap-and-trade scheme

An alliance of electricity power producers examines a proposed cap-and-trade regulation that would affect most members. The alliance lobbies lawmakers to strengthen banking and borrowing provisions in the proposed regulation, allowing increased flexibility for the sector to comply with emissions limits.

What component of climate risk is the alliance directly attempting to influence?

A.

Exposure

B.

Hazards

C.

Vulnerability

D.

Drivers

A multinational food and beverage corporation has growing concerns that CO2 and other GHGs in the atmosphere have a negative effect on agricultural productivity. The corporation is subject to higher costs and scarce availability for commodities necessary for its supply chain.

The corporation will disclose this scenario under which climate-related risk type?

A.

Market

B.

Resilience

C.

Chronic

D.

Resource efficiency

The climate risk team at a global bank works on a sustainability and climate risk report for a forthcoming company strategy meeting. The meeting will focus on bank goals to achieve net zero GHG emissions by 2050. Bank leaders will discuss potential risk exposures the bank may face, as well as possible financial systemic effects.

Which of the following is an example of how systemic climate risk can translate into liquidity risk for the bank?

A.

High level of deposit withdrawals from households and corporations after a hurricane severely affects a country.

B.

Sea level rise causes coastal property prices to decrease, which leads to real estate losses for the bank.

C.

Insurers significantly increase premiums due to climate-related risks and leave the bank without coverage, amplifying risks to financial stability.

D.

Sector-wide asset stranding for the financial sector increases due to climate pressures, which affects bank revenue and profits as cash flow decreases.

Which of the following greenhouse gases (GHGs) has the longest lifetime in the atmosphere?

A.

Methane

B.

Carbon dioxide

C.

Fluorinated gas