Name ______Class______Date ______

business costs

Directions:You have a business baking and selling chocolate chip cookies one day a week at your school. Below is the recipe you use to make enough cookies to sell in one day. Using this recipe, determine the quantity of ingredients you will need to purchase. For example, does one package of butter contain 2 cups. If not, you will need to buy more than one package of butter. In this case, you will enter “2” in the Quantity Purchased column. After you have determined the cost of making the cookies, answer the questions below.

CHOCOLATE CHIP COOKIES
Item / Amount
Needed / Quantity
Purchased / Price Per Unit / Total
Butter / 2 cups
Baking soda / 2 teaspoons
Oatmeal / 5 cups
Brown sugar / 2 cups
Hershey Bar / 8 oz.
Baking powder / 2 teaspoons
Vanilla flavoring / 2 teaspoons
Flour—plain, all-purpose / 4 cups
Sugar / 2 cups
Chocolate chips / 24 ounces
Eggs / 4
Nuts / 3 cups
Total Cost

What is the total cost of making the cookies? ______

Are these fixed costs or variable costs? Provide examples of both types of costs for your cookie business.

______

______

What are some ways you can reduce the costs of operating your business?

______

______

Name ______Class______Date ______

Supply and Demand

Directions:

  1. Before beginning this exercise, decide on one item (product or service)that you would like to sell. Determine the price for the item.
  1. Calculate the following amounts. Fill in the prices in the chart below.
  • Price plus 50%
  • Price plus 25%
  • Price minus 25%
  • Price minus 50%
  1. Ask 25 people to answer the following question:

If I had a (choose an item) for sale at the following price, would you buy it?

  1. Keep a tally of the number of “yes” and “no” answers at each price.

Item for Sale / Yes / No
Price50%
Price25%
Price
Price25%
Price50%

(continued)

  1. After you have data from 25 people, graph the number of individuals who answered “yes” for each price. This is the demand curve graph.
  1. Graph the number of items you would be willing to sell at the various prices. This is the supply curve graph.
  1. Based on your graph, answer the following questions:

a. At what price were the most people willing to buy the item?

b. At what price were the least people willing to buy the item?

c. What is the equilibrium price?