If you are on this page, you are already on the way to becoming an Actuary! So let’s deep dive into understanding CB2 exam, previously CT7 (Business Economics) has been transferred to CB2 (Business Economics) subject under the new curriculum of IFoA and IAI (after 2019).
CB2, previously known as CT7 under the older curriculum, is the Business Economics paper in the IFoA and IAI actuarial syllabus. Since the curriculum revamp in 2019, CB2 has continued to focus on the intersection of economics and business decisions, but with a more contemporary flavor.
Let’s break down what CB2 really is, and how you can best approach it.
What Does CB2 exam Really Cover?
CB2 introduces you to the world of economic thinking – both on a micro and macro level – and how these theories apply in the real business world. Whether it’s a firm’s pricing strategy, global trade trends, or how inflation impacts your purchasing power, CB2 ties it all together through the lens of economics.
The exam covers:
- Microeconomics (45%): Consumer behavior, firms, markets, pricing, production – the small scale.
- Macroeconomics (45%): Big-picture economics – governments, policies, inflation, trade, employment.
- Economic models and historical relevance (10%): A glance at how economic thinking has evolved over time.
CB2 Exam Structure at a Glance
- Exam Duration: 3 hours 15 minutes
- Question Format:
- 26–30 multiple choice questions (1.5 marks each)
- 6–10 descriptive questions (typically 5–12 marks each)
- Total Marks: 100
- Medium: Online/Offline – please check on institute website for updated information.
How Much Time Should You Set Aside for CB2?
The IFoA recommends approximately 150 hours of preparation for this exam. However, if you have a background in economics from school or university, you’ll probably require less time to get the hang of it.
Do You Need Coaching for CB2 exam?
Absolutely not mandatory. CB2 exam is considered one of the easier exams in the actuarial journey. The core reading from IFoA or IAI is detailed and well-explained. It even includes real-world examples, graphs, and context to make sure you aren’t just memorizing theory but actually understanding how to apply it.
That said, if you’re new to economics, a bit of guidance or group study might help you build your base faster.
Is CB2 a Theory-Based Exam?
Yes, CB2 is application-based theory. You’ll have:
- Diagrams to interpret (e.g., supply-demand curves, elasticity)
- Situational-based questions
- A few numerical calculations (especially in elasticity and production-related chapters)
CT7 vs CB2: What Has Changed?
While the core structure is similar, CB2 introduces a fresher, more modern syllabus. New inclusions:
- Macroeconomic history
- Participants in financial markets
- Budget lines and indifference curves
- Modern strands of economic thinking
At the same time, a few outdated sections (like portions of Chapter 4, 9, and 10 from CT7) have been dropped. If you’re switching from old to new curriculum, make sure you’re studying from the latest Core Reading and referring to the John Sloman Economics textbook, as advised.
Key Topics You’ll Learn in CB2 exam
- Scarcity, opportunity cost, and decision-making
- Micro vs macroeconomics
- Economic models and thought processes
- Historical evolution of economic theories
- Supply and demand dynamics
- Market equilibrium and price mechanisms
- Elasticity of demand and supply
- Business cost structures and production theory
- Consumer behavior and utility
- Role of advertising in markets
- Market structures: Monopoly, Oligopoly, Monopolistic
- Pricing strategies
- Globalization & international trade
- Exchange rates and currency markets
- Inflation, interest rates, and money supply
- Employment and macroeconomic stability
Passing Marks for CB2
Generally, the pass mark for CB2 hovers around 60 marks out of 100, though it’s officially released after results are out. Always aim for 70+ to be safe.
Tips & Tricks to Ace CB2 from IAI & IFOA
- Thoroughly read the Core Reading – everything builds from there.
- Practice MCQs from past papers – they can be trickier than they look.
- Draw graphs repeatedly – understanding them visually helps a lot in the exam.
- Solve numerical problems – elasticity and production numericals are common.
- Time yourself while solving papers – especially the theory section.
- Attempt at least 5 past year papers – your confidence will increase dramatically.
CB2 Exam Fees (IFoA & IAI)
The latest exam fees for IFoA exams can be found directly on their official website. Prices vary depending on your membership status.
All the Best!
CB2 is not just another tick on your exam list – it’s the foundation of how actuaries understand the market, the economy, and the world we live in. Once you truly grasp its concepts, you’ll find it helps beyond just passing an exam.
Have questions? Drop them in the comments or reach out to us directly. We’re always here to help!
The exam consists of 26-30 multiple choice questions of 1.5 marks each and around 6-10 long and medium answer questions of around 5-12 marks.
Yes, CB2 is highly self-study friendly. With consistent effort and the Core Reading, you’re good to go.
No, It isn’t necessary to take coaching for exam as it is considered one the easiest exams of the Actuarial curriculum. For those who have studied Economics as a part of their High School subjects or as a part of their University’s curriculum, this exam will be very easy to prepare for.
For those who haven’t studied Economics earlier will also be able to understand it properly by studying Core Reading provided by IFoA as it explains in a very detailed, easy manner, all the concepts along with their examples.
Yes, CB2 is an application-based theory paper which comprises of MCQs, graphs also.
Some new topics are added to CB2 syllabus such as Macroeconomic history, the role of financial markets, participants in financial markets, economic thinking strands, indifference curves, and budget lines. Chapter 4, chapter 10 and some portion of chapter 9 are removed and there are some additions to chapter 17.
We recommend you to study from the new CB2 curriculum Core reading and also study the specified pages of John Sloman Economics Book that are advised to be read in the Core Reading material.
The topics covered under CB2 curriculum are:
1. Basic economics concepts like scarcity, choices made by businesses.
2. The difference between Microeconomics and Macroeconomics.
3. The economic thinking strands of various models of economists.
4. Recent history of macroeconomics.
5. Concepts of Market Demand and Market Supply.
6. Equilibrium Concepts.
7. Price and Income elasticity of Demand and Supply.
8. Costs, Revenue and Production Functions for businesses.
9. Consumption Behavior.
10. The effect of Advertising on businesses.
11. Different types of markets- ,Monopoly, Monopolistic and Oligopoly.
12. Various Pricing strategies/
13. Globalization.
14. International Trade.
15. Balance of Payments.
16. Exchange Rates.
17. Role of Money and interest in the economy.
18. Inflation and various ways to control it.
19. Unemployment and its effects on Economies
The IFoA declares pass marks of each subject at the result declaration. For CB2, it remains close to 60 marks for the 100-mark paper.
1. Self study the Core reading material with great focus.
2. Practice Graphs, numericals related to elasticity and Costs.
3. Practice time management.
4. MCQs are bit confusing. So, practice them from past year papers as much as possible.
5. Before the exam, practice atleast 5 past year papers effectively. This will give you an idea of how write to the point explanation to questions.
The exam fee structure of IFoA can be found here.
All the best for your exam! Let us know in case you have any questions about the exam in the comments section!
Other Actuarial Exams Helpful Links
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