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LESSON: ONCE UPON A COMPANY ... A TRUE STORY
Lesson Summary
A young boy and his two sisters started a wreath-making business and a peanut butter and jelly lemonade stand to make money for college. As the companies and the profits grew, they became experienced in marketing, wholesaling, employing salespeople, and investing.
Concept: Investing
Definition: Investing occurs when people and businesses use money to purchase capital goods or increase the skills and abilities of workers.
Comprehension Questions:
Why did the boy and his sisters create The College Fund Wreath Company?
To give them something to do in the cold and wet November days and to earn money for college.
How did the company get started?
The man next door gave them scraps of pine trees to make their wreaths. They sold them to the people in the town.
How did the company grow?
They began to sell the wreaths to businesses, opened a store in town, hired salespeople, and got more people to help. They also began to sell lemonade, peanut butter and jelly sandwiches, and more at a local art fair each summer.
How did the children figure their profit?
They took all the revenues they made from their growing business and subtracted their expenses to get their profit.
How did they make their profit grow?
They gave the money to a stockbroker to invest for them until they needed it for college.
Why was it smart to invest in Zero-Coupon Bonds?
This is a special way to save money and have it grow by the time the students go to college.
Explain how the wreath company is an investment in human capital.
The money made from the company will be invested in the education of the children. Education usually results in more productive members of society.
Other Concepts: Entrepreneur, Producers, Savings, Productive Resources, Productivity, Profit
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