Economics

Economics for the CFA Level 1 exam covers microeconomic and macroeconomic concepts essential for financial analysis. The microeconomics portion examines how individual economic agents make decisions, focusing on supply and demand dynamics, market structures, production costs, and firm behavior. You'll study elasticity concepts that measure responsiveness of quantity to price changes, and explore market efficiency versus market failures. The macroeconomics section broadens to national and global perspectives, covering GDP measurement, economic growth theories, business cycles, inflation, unemployment, and monetary/fiscal policies. International economics topics include trade theories, balance of payments, exchange rate systems, and currency regimes. The curriculum emphasizes practical applications for investment professionals, teaching you to interpret economic indicators, forecast trends, and assess policy impacts on asset prices and portfolio performance. Key frameworks include aggregate demand-aggregate supply models, IS-LM analysis, and the Phillips curve relationship. Recent additions to the curriculum address sustainable economics and ESG considerations. Throughout the economics section, you'll learn to evaluate how government interventions and central bank policies affect different asset classes, and develop skills to incorporate economic analysis into investment decision-making. The exam tests both theoretical understanding and practical application through calculation-based and conceptual questions that reflect real-world scenarios financial analysts encounter.

Economics for the CFA Level 1 exam covers microeconomic and macroeconomic concepts essential for financial analysis. The microeconomics portion examines how individual economic agents make decisions,…

Concepts covered: Economics of Regulation, Currency Exchange Rates, International Trade and Capital Flows, Microeconomics, Macroeconomics