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Sixth Grade Math Portfolio Project | |
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background | In 1991, the Warsaw Pact that had united the countries of Eastern Europe with the Soviet Union was officially dissolved. These formally communist countries were open for the first time since World War II to products and companies from Western Europe and the United States. Many of the countries, such as Poland and Hungary, began moving to a more capitalist economy. Now, as budding capitalists, you will start a company in a former "Iron Curtain" country that sells one "American" product. |
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objectives | Students will learn about the mathematics involved in successfully running a business by completing a simulation in which they will start a company that sells an American good to a country in Eastern Europe. Students will investigate the use of spreadsheets and formulas in calculating sums, averages, and percents. Students will use a random number generator and create a graph as well. |
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procedure |
Phase 1: The Product (checkpoint - February 5) a) Choose a product that you would like to sell. b) Choose a company name. c) Choose a city and country to sell to. Find out the population of the city. Determine the currency and language of the chosen country. d) Create an advertising slogan for your product. Create a written advertisement about your product that addresses the consumer population you have chosen. Use the native language and currency whenever possible (you will have to convert from dollars to the selected currency). Phase 2: A Loan Starting a business requires capital, the amount of money necessary to get products ready to sell and to support the business until there is income from sales. (checkpoint - February 10) a) As a class, you will set up a spreadsheet that will keep track of the monthly loan payments required to pay off a one year loan of capital. Interest will be calculated on the outstanding balance at the end of each month. b) After the spreadsheet is set up, answer these questions in your business log: If the interest is doubled, does the payment double? If the loan amount is doubled, does the payment double? How much initial investment do you think you need? Phase 3: Sales In business, it is necessary to guess how many items might be sold in a month. If the estimate is too high, inventory will sit and you will not recover your investment quickly. If estimates are too low, you may run out of your product! (checkpoint- February 12) a) As a class, we will set up the inventory section of your spreadsheet. b) Estimate what your monthly sales will be based on the product and size of the town. Remember that some products are disposable goods and others are not. Record whether your item is a disposable good and how many you plan to sell in your business log. Phase 4: Open for Business The final steps are determining how much it costs to make each item, figuring out a profit margin, and setting the price. a) As a class, we will set up the expenses, income, and profit/loss areas of the spreadsheet. b) Determine a reasonable markup percentage and price for your item. c) We will run the simulation twelve times using the random number generator to determine your sales for each month. d) For each month, you must write in your business log what happened to your company that month and why you think it could have happened. For example, if you were a candle maker and your sales skyrocketed in December, you might think that there was a power outage. Be creative! Phase 5: What's the Bottom Line? a) In your business journal answer these questions: How small could your initial loan have been to avoid unnecessary interest costs? What difference does it make when the markup is raised or lowered? What was your bottom line? Why would your product appeal to someone in Eastern Europe? **What would you change for your business next year? b) Create a graph in your business log that shows your sales, income, profit, inventory, OR cash on hand. c) Put a final copy of your spreadsheet in your business log. d) Present your company to the class. Approximate Due Date: March 2, checkpoints are subject to change **This project was adapted from "Colonial Entrepreneurs" by Apple Computer, Inc.** |
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