Biomolecules

Cholesterol is the parent steroid from which the body forms (transforms into) all the other steroids.
It is converted into steroid hormones (cortisol, aldosterone, testosterone, estrogen and progesterone), bile acids and vitamin D.
So cholesterol is the steroid used as the starting material for these transformations. (The question is worded loosely; it refers to steroid transformation, not to bacterial transformation.)
So, as per the answer key, the steroid used for transformation is cholesterol.

Erucic acid is a long chain (C22) monounsaturated fatty acid present in large amounts in mustard and rapeseed oil.
High erucic acid content is considered harmful (it is linked to heart damage in animal studies), so it is used as an indicator of the quality of edible oils; low erucic acid varieties (e.g. canola) have been developed.
So, as per the answer key, spoilage (poor quality) of oil is detected by erucic acid.