Exam Weight: ~6 questions (5% of exam)
This unit covers the economic principles that affect investment decisions and market performance. Understanding them helps investment advisers make informed recommendations based on macroeconomic conditions.
What You'll Learn
- How business cycles move through four stages and why GDP matters
- How monetary and fiscal policies drive inflation, growth, and interest rates
- How sovereign debt, geopolitical events, and currency strength affect markets
- What causes inflation and deflation, and how they affect different investments
- Why yield curves slope upward and what credit spreads signal about risk
- The structure of balance of payments and economic indicators that predict business cycles