Lesson Plan

• Describe the concept of economies of scale and identify its five types (purchasing, marketing, financial, managerial, technical).
• Explain how each type reduces average cost and give a real‑world example.
• Analyse the conditions that lead to diseconomies of scale and evaluate their impact on business decisions.
• Apply the LRAC diagram to determine whether a firm is experiencing economies or diseconomies of scale.

• Projector or interactive whiteboard
• PowerPoint slides summarising each economy type
• Printed worksheet with case‑study scenarios
• LRAC diagram handout
• Markers and flip chart
• Calculator (optional)

Begin with a quick poll: “What advantages might a large supermarket have over a small corner shop?” Connect responses to prior knowledge of cost concepts, then outline that today students will explore how size creates cost savings and when it backfires. Success will be measured by their ability to classify economies of scale and interpret a LRAC curve.

1. Do‑now (5’) – Students list cost advantages they think large firms enjoy; share briefly.
2. Mini‑lecture (15’) – Present the five types of economies of scale with examples using slides; highlight key cost‑reduction mechanisms.
3. Group activity (15’) – In small groups, analyse a case‑study worksheet, identify which economies apply, and calculate average marketing cost using given data.
4. Whole‑class debrief (10’) – Groups report findings; teacher clarifies misconceptions and introduces diseconomies of scale.
5. Diagram exploration (10’) – Show LRAC curve; students label sections representing economies and diseconomies and discuss causes.
6. Check for understanding (5’) – Quick quiz (Kahoot or exit ticket) with three scenario questions.

Summarise that economies of scale lower unit costs through five distinct mechanisms, while diseconomies raise costs when a firm grows too large. Ask students to write one key takeaway on an exit ticket and suggest they research a local business to identify which economies it exploits for homework.