Lesson Plan

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Lesson Plan
Grade: Date: 17/01/2026
Subject: Economics
Lesson Topic: Supply-side policy measures: lower direct taxes
Learning Objective/s:
  • Describe how lower direct taxes affect household disposable income and firm after‑tax profit.
  • Explain the short‑run and long‑run effects of tax cuts on aggregate supply, demand, employment and price level.
  • Evaluate the advantages, disadvantages and contextual factors influencing the effectiveness of lower direct tax policies.
  • Apply the formula ΔYafter = Y × Δ(1‑t) to calculate changes in after‑tax income.
Materials Needed:
  • Projector and screen for slides/diagrams
  • Whiteboard and markers
  • Handout summarising key concepts and evaluation points
  • Calculator worksheets for applying the after‑tax income formula
  • Sample data tables for short‑run vs long‑run effects
  • Sticky notes for quick exit ticket
 Introduction:
Begin with a quick poll: “If your income tax were cut by 5 %, what would you do with the extra money?” This links to students’ prior knowledge of taxes and incentives. Explain that today they will explore how lower direct taxes aim to boost supply, and they will be able to identify expected macro‑economic effects and evaluate the policy.
Lesson Structure:
  1. Do‑now (5’) – students write poll responses on sticky notes and share a few ideas.
  2. Mini‑lecture (10’) – present key concepts and the LRAS‑shift diagram.
  3. Guided analysis (15’) – pairs use a data table to identify short‑run and long‑run effects on AS, AD, employment and price level.
  4. Evaluation debate (10’) – groups discuss advantages, disadvantages and contextual factors, then report back.
  5. Formula practice (5’) – calculate change in after‑tax income using the worksheet; teacher checks understanding.
Conclusion:
Summarise that lower direct taxes can shift LRAS rightward by raising incentives but may have short‑run fiscal costs. For the exit ticket, students write one potential benefit and one limitation of the policy. Assign homework to research a recent real‑world tax cut and analyse its macro‑economic impact.