Lesson Plan

• Describe why the demand for labour is a derived demand.
• Explain how the marginal revenue product of labour (MRP_L) determines the profit‑maximising hiring rule.
• Analyse how changes in product price, technology, input costs, market structure and expectations shift the labour demand curve.
• Evaluate the impact of key government policies on derived labour demand.
• Apply the MRP calculation to a numerical example and interpret the hiring decision.

• Whiteboard or interactive whiteboard
• Projector and screen
• PowerPoint slides with MRP diagram and demand‑shift table
• Handout summarising determinants of labour demand
• Calculator worksheets for MRP calculations
• Sticky notes for quick poll and exit‑ticket responses

Begin with a quick poll: “If a firm’s product price rises, what happens to its need for workers?” Connect this to prior learning on factor markets and set the success criteria – students will be able to explain derived demand, calculate MRP, and predict how the labour demand curve shifts.

1. Do‑now (5') – Students write their poll answers on sticky notes; teacher collects and displays a few responses.
2. Mini‑lecture (10') – Define derived demand; derive MRP_L = MP_L × MR and illustrate the profit‑maximising rule MRP = Wage.
3. Guided calculation (8') – Work through the example of the third worker (MP=5, MR=$20, Wage=$80) and discuss the hiring decision.
4. Determinants analysis (12') – Small groups examine the determinants table, create brief explanations of how each factor shifts demand, then share with the class.
5. Government policy impact (8') – Whole‑class discussion linking tax, subsidies, minimum wage, and R&D to the determinants.
6. Check for understanding (5') – Quick quiz (multiple‑choice or show of hands) on key concepts.
7. Summary & revision questions (5') – Review the four revision questions; students answer one as an exit ticket.

Recap that labour demand follows the rule MRP = Wage and that product price, technology, input costs, market structure and expectations shift the curve, while government policies influence these determinants. For the exit ticket, students write one way a tax on output can affect employment. Homework: complete a worksheet calculating MRP for different scenarios and answer the revision questions.