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Introduction to Markets - Lesson Plan: 1 x 1 hour lesson

A series of 'off the shelf' lesson plans and resources for use in the classroom. This lesson deals with an introduction to markets and considers the growth of illegal markets. It is relevant to the following specifications:

  • AQA: AS Module 1
  • Edexcel: AS Units 1 and 2
  • OCR: AS Units 2881 and 2882

Aim:

The aim of this lesson is to give students the opportunity to get to grips with the concept of a market. The plan assumes that an introductory session on the nature of markets has been given but there is a Powerpoint Presentation on markets that can be used for this purpose. You can follow this lesson by taking a more detailed look at supply and demand and price determination.

Background:

Whilst the scope and nature of markets can be seen as being very obvious to educators, to a student coming at the topic for the first time there is a danger that we can assume that they have an intuitive understanding of markets when in reality they may not. The lesson therefore begins with an exploration of what students already know about markets. The series of questions posed allows the educator to encourage students to identify what their understanding of a market is. This can be followed up by the Presentation or you could go straight into the Activity. The questions that accompany the Activity are again designed to encourage students to think about issues surrounding markets rather than just assessing their knowledge. The Activity can be used to help reinforce the lesson and the concepts covered.

Learning Objectives:

At the end of the lesson, students should understand the following:

  • A working definition of a 'market'
  • That markets are dynamic and that the bringing together of buyers and sellers can be both physical (as in a retail outlet) and a process (as in buying over the Internet)
  • The different aims of buyers and sellers
  • The concepts of 'utility' and 'value for money' in affecting decision making by consumers
  • The principle of 'cost' and 'profit' as factors affecting decision making by producers

Resources:

Lesson Structure:

  1. Begin with a discussion about what students already know about markets. What do we mean by the 'market for labour', the 'market for cotton' and so on? This could be done through getting students to write down their ideas in small groups or through a whole class discussion, or through selecting individual students to contribute their ideas on the white/chalk board. (10 minutes)
  2. Go through the PowerPoint Presentation - Introduction to Markets. (10 minutes)
  3. Direct students to the PCs. Students are given the opportunity to look at some organised markets. Details can be accessed from a number of sites - some URLs are suggested below. Students can be given a sheet with some questions on which they need to think about and if appropriate, write an answer to.

    These are sites that give updates on market prices in key commodity and financial markets. It is advised that the educator accesses these sites prior to the lesson to assess the appropriateness of the information.

    • Commodity Futures - Bloomberg (http://www.bloomberg.com/markets/commodities/cfutures.html)
    • Americas Currencies - Bloomberg (http://www.bloomberg.com/markets/currencies/americas_currencies.html)
    • Energy Prices - Bloomberg (http://www.bloomberg.com/markets/commodities/energyprices.html)
    • Commodities - FT (http://news.ft.com/markets/commodities/daily)
    • Foreign Exchange Graph - The Economist (http://www.economist.com/markets/currency/graphs.cfm)
    • Active Futures - CNN Money (http://money.cnn.com/markets/commodities.html)
    It is often useful if students access different sites to avoid slowing down the connections - unless your system is very quick! (25 - 30 minutes)
  4. The answers can then be discussed either in smaller groups or as a class towards the end of the lesson. The teacher then needs to draw together the points raised to help address the learning objectives. (10 - 15 minutes)

Questions for Students:

  • What is being traded on the market you are looking at?
  • Who do you think the buyers and the sellers would be?
  • Why might they be buying and selling these items?
  • Some of these markets are 'futures' markets - what do you think this means?
  • What has happened to the price in the markets that you are looking at?
  • Why do you think the price might have changed?

Students can be encouraged to look at other links that may be available to help them to answer the questions. What is more important at this stage is to encourage students to think and explore their intuitive ideas - they may not be right but we are trying to find out what they know before launching into a more detailed investigation of markets. Giving them some concrete examples helps to link theory and practice at an early stage.

Supporting Activities:

Think of more obvious markets that you are aware of - shops, banks, leisure facilities, pubs, restaurants, night clubs and so on. Who are the buyers and the sellers in these markets? How does each group make decisions about purchases?

The aim of these questions is to get students to explore the factors that might affect demand and supply - without using those terms at this time.

So - if you go to a night club, what determines which one you will go to? If you were the owner of a night club, what factors would you have to think about in offering your service and how would you go about attracting customers?

Crucial at this stage is the notion that we all make subconscious decisions about our purchases - if we think something is too high a price, we have a way of reconciling this in our own minds with what we would see as value. The use of a CD is a good medium - the CDs that we as educators buy are not likely to be the same ones as students buy - we have different perceptions of what is 'value' - I would not pay £12 for a Slipknot CD but I would pay £30 for a good quality live recording of Yes in their prime! (You might have to explain who 'Yes' or your chosen example is!)