Production of Goods and Services · SHS2 Economics

Lesson notes

Learning Objectives

Indicator: 2.2.1.LI.4 - Apply the concept of cost to calculate average, total and marginal costs.

By the end of the lesson, learners can:

Define total cost, average cost and marginal cost using their own words and distinguish between fixed and variable cost elements.
Calculate total cost, average cost and marginal cost from a given data set of output levels and cost figures.
Complete a cost schedule showing output, total cost, average cost and marginal cost for a firm.
Interpret the behaviour of average cost and marginal cost as output increases, and state the relationship between the two.
Use information gathered from an interview with the school matron or a canteen seller to compute the cost of cooking breakfast per student and the cost of one additional serving.

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Curriculum details

Strand: Firms' Innovative Decision Making (Strand 2)
Sub-strand: Production of Goods and Services (2.1)
Content standard: 2.2.1.CS.1 - Apply knowledge and understanding of production to pricing of goods. 2.2.1.LO.1 Use information gathered from the environment to determine the time periods, TP, AP, MP, labour and capital-intensive methods and the cost of production. 2.2.1.LO.2 Establish the relationships among Total Revenue (TR), Average Revenue (AR), and Marginal Revenue (MR).
Indicator: 2.2.1.LI.4 - Apply the concept of cost to calculate average, total and marginal costs.
Suggested placement: Semester 1, Week 12 (Week 12 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:

core competencies - p.66 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 66 and cross-checked against a letter-for-letter decode
core competencies - p.67 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 67 and cross-checked against a letter-for-letter decode
Curriculum reference: NaCCA curriculum document, p. 68

Exemplars (from the NaCCA curriculum)

Experiential Learning: Form a mixed ability and gender groups and interview the school matron on how much it cost to cook breakfast for the entire school (Total Cost [TC]) per student (Average Cost [AC]) and an additional student (Marginal Cost [MC]). Ask her the fixed and variable cost elements. Or visit the school canteen and interview a seller on the above
- Knowledge of learners in themselves and others' peculiarities, strength and weaknesses
- Tolerance for diversity and respect for all
Assessment (2.2.1.AS.4). The document marks these depth-of-knowledge levels for this indicator: Level 4 Extended critical thinking and reasoning.
Teaching and Learning Resources:
- Pen
- Exercise books
- Computer projectors markers
- White board
- ICT Lab
- Microsoft PowerPoint