Market Analysis · SHS2 Economics

Lesson notes

Learning Objectives

Indicator: 2.2.3.LI.2 - Determine the types of profits (super-normal, normal and sub-normal).

By the end of the lesson, learners can:

Define super-normal, normal, and sub-normal profits in their own words with reference to the relationship between total revenue and total cost.
Distinguish between normal profit (which is a cost) and super-normal or sub-normal profit (which are economic profits or losses).
Calculate the type of profit a firm is making given figures for total revenue, explicit costs, and implicit costs.
Determine graphically and numerically whether a firm in a given market structure is earning super-normal, normal, or sub-normal profit.
Justify, using critical reasoning, why firms may continue to operate in the short run even when earning sub-normal profit.

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Curriculum details

Strand: Firms' Innovative Decision Making (Strand 2)
Sub-strand: Market Analysis (2.3)
Content standard: 2.2.3.CS.1 - Demonstrate understanding of Market Structures. 2.2.3.LO.1 Analyse the various markets and determine the types of profits.
Indicator: 2.2.3.LI.2 - Determine the types of profits (super-normal, normal and sub-normal).
Suggested placement: Semester 1, Week 20 (Week 20 of the year)
Our suggestion, laid out in curriculum order across three terms of twelve weeks. NaCCA does not fix the week, so follow your school's scheme of learning.
Source document note: The official curriculum document has a fault in this entry, so the curriculum text above is transcribed exactly as printed:

indicator text - p.75 the document prints the learning-indicator code as "2.1.2.3LI.2", a four-segment prefix naming a different sub-strand; the section wins - the page is headed Strand 2 Sub-Strand 3 Market Analysis and prints 2.2.3.CS.1, 2.2.3.LI.1 and 2.2.3.AS.1
exemplars - p.75 the document prints the assessment code as "2.1.2.3AS2", a four-segment prefix naming a different sub-strand and no separator before the final digit; the section wins
core competencies - p.73 the document sets part of this text in a Calibri subset with no ToUnicode map, so the text layer reads as Latin Extended letters; the wording stored here was read off a 150 dpi render of printed page 73 and cross-checked against a letter-for-letter decode
Curriculum reference: NaCCA curriculum document, p. 75

Exemplars (from the NaCCA curriculum)

Building on What Others Say: Build on your previous knowledge on cost and revenue in small groups to discuss the conditions needed to determine profits and loss for the various markets. Be sensitive to different abilities and gender groups.
Assessment (2.2.3.AS.2). The document marks these depth-of-knowledge levels for this indicator: Level 4 Extended critical thinking and reasoning.
Teaching and Learning Resources:
- Short, recorded videos
- Internet
- Computers
- ICT lab
- Pens
- Exercise books
- Markers
- White boards
- Projectors