Remember: A business pays its start-up costs once, then charges more than each sale costs.
Read and answer
Read the story first, then answer.
Leo's Juice CartEvery Saturday Leo sold lemonade at the Maple Hill market, and the line grew longer each week. Nico from the flower shop walked over for a look. He said, "Your stand could grow into a small business. A business makes or sells something people want, again and again." That night Leo dreamed of a real cart with a striped roof, called Leo's Juice Cart. A cart would not come free, so he listed what to buy first. Those costs, paid once before the very first sale, are called start-up costs. A used cart was ten coins, a sign two, and a jug and ladle four. In the jar sat twenty pretend coins, saved up from the stand. Leo paid for the cart, the sign and the jug, and four coins stayed behind in the jar. Each cup needed a lemon, sugar and a paper cup, one coin in all. That is a running cost, because it comes back with every cup. A price of one coin would only pay for the next cup, so Mina tasted one and said it was worth three coins. Leo charged three. Now each cup paid for its own lemon, with two coins left over.
1
What is a business, the way Nico explains it?
Something you buy onceA game for the marketMaking or selling something people want, again and again
2
Circle every start-up cost, paid once before the first sale.
The used cartLemons for each cupThe signA paper cup for a saleThe jug and ladle
3
The cart costs 10, the sign 2, and the jug and ladle 4. Together the start-up costs are coins.
4
Leo's jar holds 20 coins. After he pays 16, coins are left.
5
Each cup needs a lemon, sugar and a paper cup, one coin in all. What kind of cost is that?
A running cost: it comes back with every cupA start-up costA tax
6
A cup sells for 3 coins and costs 1 coin to make. coins are left over.
Order, match and fix
7
Put the start of Leo's business in order.
An idea: Leo dreams of a cart
Earn from sales
A list of start-up costs
Buy the cart, the sign and the jug
Open the cart for customers
8
Join each word to what it means.
1Start-up cost
2Running cost
3Price
4Coins left over
Apaid once, before the first sale
Bcomes back with every cup
Cthe price take away what a cup costs
Dwhat a customer pays: 3 coins
9
Leo has to buy the cart again every Saturday.
TrueFalse
10
A price of 1 coin a cup would pay for the next cup and leave no coins over.
TrueFalse
11
A friend says: charge 1 coin a cup, and the cup pays for itself with extra. What is wrong?
A cup costs 3 coins to make1 coin only pays for the next cup, with nothing left over1 coin is too much
12
Stretch: think of a stall you know. Write one start-up cost and one running cost for it.
13
Draw Leo's Juice Cart. Label one start-up cost and one running cost.
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Answer key · Set A
Starting a small business
1Making or selling something people want, again and again A business makes or sells something people want, again and again.
2The used cart, The sign, The jug and ladle The cart, the sign and the jug and ladle are bought once. Lemons and paper cups come back with every cup.
316 10 + 2 + 4 = 16 coins before a single cup is sold.
44 20 take away 16 leaves 4.
5A running cost: it comes back with every cup It comes back with every cup, so it is a running cost.
62 3 take away 1 leaves 2 coins over.
71, 5, 2, 3, 4 First the idea, then the list, then buying, then opening day, and last the sales.
81-A, 2-B, 3-D, 4-C Start-up costs are paid once, running costs come back, the price is what customers pay, and the rest is left over.
9False The cart is a start-up cost. Leo pays it once, and never paid for the cart again.
10True The cup costs 1 coin to make, so 1 coin only pays for the next cup.
111 coin only pays for the next cup, with nothing left over One coin pays for the next cup and leaves nothing over. At 3 coins, 2 coins are left over.
12Your own words: a grown-up reads it.
Mark each answer, count the right ones and write the score on the sheet.