CFA Level 2: Economics
Master the CFA Level II Economics topic area. This course covers both official 2026 Learning Modules across five teaching chapters: how currencies are quoted and traded — bid-offer spreads, cross rates from the correct sides, triangular arbitrage executed leg by leg, forward points, and marking a forward position to market; the international parity conditions — covered and uncovered interest parity, forward rate parity, purchasing power parity, and the international Fisher effect — as one connected system, with what each can and cannot forecast; the carry trade and its crash risk; balance-of-payments flows, monetary and fiscal policy under the Mundell-Fleming framework, central bank intervention, capital controls, and the warning signs of currency crises; growth accounting and forecasting potential GDP; capital deepening versus technological progress; and classical, neoclassical, and endogenous growth theories with the convergence arithmetic that follows. Every worked problem is stated exam-style and solved by hand first — with BA II Plus keystrokes where the calculator is the exam-day tool — then validated in runnable Python, and assessed in the exam's own vignette format: item sets with data exhibits, three-option questions, and distractors built from real candidate errors. The course closes with a full timed item-set exam. Aligned to the 5-10% CFA Level II exam weight.
- Level: intermediate
- Duration: 3 weeks
- 7 sections
- Price: $20
Topics: currency exchange rates, bid-offer spread, cross rates, triangular arbitrage, forward premium, forward points, mark-to-market forward, covered interest rate parity, uncovered interest rate parity, purchasing power parity, international Fisher effect, forward rate parity, exchange rate forecasting, REER, carry trade, funding currency, balance of payments, current account, capital flows, Mundell-Fleming, central bank intervention, capital controls, currency crisis, economic growth, potential GDP, output gap, growth accounting, production function, capital deepening, total factor productivity, technological progress, labor productivity, demographics, human capital, natural resources, Dutch disease, classical growth theory, neoclassical growth theory, endogenous growth theory, steady state, convergence hypothesis, club convergence, trade barriers, CFA Level II, economics, item sets, vignettes
What's inside
- Economics (CFA Level II)
- Chapter 1: Currency Quotes, Arbitrage, and Forwards
- Chapter 2: International Parity Conditions and the Carry Trade
- Chapter 3: Balance of Payments, Policy, and Currency Crises
- Chapter 4: Growth Factors and Growth Accounting
- Chapter 5: Growth Theories, Convergence, and Trade
- Chapter 6: Economics Item-Set Exam