Business and enterprise

L3238

7–8

In the 'Muffin bakery' series students explore various factors affecting business profitability in order to maximise profit. These factors include fixed and variable costs, pricing and volume discounting.

Students run a muffin shop and are challenged to work out the best combination of production volume and price to maximise profit. They examine the sales figures and the effects of unsold stock on profit. This learning object is the first in a series of three objects that progressively increase in difficulty.

• Students explore how retail profitability is related to customer demand and unit costs.
• Students analyse sales results and adjust production volumes and prices accordingly.
  
• Students test business ideas and respond to market feedback.

The learning object:

• highlights the significance of unit costs and price elasticity when determining production volume and retail prices;
• introduces how profit is calculated;
• demonstrates the relationship between price and demand;
• provides tables of sales results from a simulated trading period;
• encourages students to examine business outcomes and adapt business ideas;
• has task design that supports repeated testing of ideas and an iterative approach to business modelling.

Studies of society and environment

Baking, Business, Costs, Price determination, Price elasticity, Production (Economics), Production volumes, Profit, Profitability, Sales, Supply and demand 

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