JA BizTown™
Unit 4: Business Management
Lesson Supplement
Unit 4: Business Management
1. What Is a Quality Business?
2. How Do Businesses Succeed?
3. What Are Business Costs?
4. Which Price Is Best?
5. Why Advertise?
6. What Else Should Be Prepared?
Lunch Web Report
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The Costs of Doing Business
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Sample Business Costs
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Friendly Letters
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Which Price?
Kirsten and Tobey will sell lemonade in front of their house. They
conducted a market survey and found out how many glasses people
would buy at different prices. This information is given in the first
and second columns. They also know that their costs will be 25¢ per
glass.
Let’s compute their profit at different prices.
Price
# of glasses
$0.50
10
$0.40
20
$0.30
30
$0.20
40
Revenue
Costs
Profit
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Which Price?
Kirsten and Tobey will sell lemonade in front of their house. They
conducted a market survey and found out how many glasses people
would buy at different prices. This information is given in the first
and second columns. They also know that their costs will be 25¢ per
glass.
Let’s compute their profit at different prices.
Price
# of glasses
Revenue
Costs
Profit
$0.50
10
$5.00
$2.50
$2.50
$0.40
20
$8.00
$5.00
$3.00
$0.30
30
$9.00
$7.50
$2.50
$0.20
40
$8.00
$10.00
-$2.00
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Setting a Selling Price
1. What must a business consider when setting a selling
price for a good or service?
- business costs, how much consumers are willing
and able to pay
2. What effect will a decrease in price have on sales?
- When prices go down, people will buy more.
3. Why should a business avoid selling a good or service
for less than it costs to produce it?
- A business must earn a profit to remain in business.
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Setting a Selling Price
4. Many stores sell end-of-the-season clothes at very low
prices. Why?
- These items are no longer popular; the business
must make room for new inventory
5. How is selling price related to profit?
- price x quantity sold = revenue
- revenue – costs = profit
- Prices will affect how much a business sells and
how much revenue it earns.
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Characteristics of a
Good Advertisement
1. Grabs customers’ attention
2. Holds customers’ interest
3. Creates a desire for the product
4. People buy the product
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Sample JA BizTown Schedule
15 Minutes
Citizen Welcome/Orientation
45 Minutes
Business Start-Up
15 Minutes
Opening Town Meeting
60 Minutes
Employee Work/Break Rotations
(three sessions/20 minutes each)
10 Minutes
Uninterrupted Staff Meeting (at Each Business)
90 Minutes
Employee Work/Break Rotations
(three sessions/30 minutes each)
10 Minutes
Business Clean-Up
10 Minutes
Final Staff Meeting (at Each Business)
15 Minutes
Closing Town Meeting
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Completing a Deposit Ticket
1. Complete the following table in your workbook.
Salary
2% Payroll Tax
Net Pay
$9.00
--
___________
=
$___________
$8.50
-
___________
=
$___________
$8.00
-
___________
=
$___________
2. Complete the following deposit ticket for an employee who has a $9.00
salary and wants to receive $2.00 in cash.
3. In your workbook circle the net pay for your JA BizTown job in #1 above.
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Citizen Checklist
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