Examples of a teacher (T) talking with students (P1-P5) to investigate their understanding of profit
(Taken from Davies, P. & Dunnill, R. (2006). Improving learning by focusing on variation, Teaching Business and Economics, 10, 2, pp. 25-31)
Variation in GCSE students' conceptions of profit was investigated in the context of a piece of work they were carrying out on a drinks stall at a school fete. This context had been chosen because it fell within their experience. Even though they were unlikely to have been responsible for the finances of a stall, they could imagine much of what might be entailed.
To explore students' understanding of profits a leading question was posed while students were engaged in their work: "What could you do to increase the profits made by the stall?"
T How could you increase profits?
P1 By selling more cans, buying more cans from the wholesaler.
T Anything else?
P1 Not sure.
T How could you increase profits?
P2 Sell more cans.
T Anything else?
P2Increase the price.
T Anything else?
P2 No.
T If you changed any of these things would anything else be changed?
P2If you increase the price you might not be able to sell as many.
THow would you increase profits?
P3 You could put the price up or use advertising.
THow would advertising help?
P3You would sell more so your revenue would go up and your profits.
T So how do you calculate profits?
P3Oh, hold on, you would have to pay for it wouldn’t you?
T Go on.
P3 Your fixed costs would get bigger as well as your revenue.
T So how would you work out whether your advertising would increase profits?
P3 Don’t know.
T How could you increase profits?
P4By putting the price up and selling less.
THow would that work?
P4 Well if you put the price up you would sell less so you’d have to buy less. Say if you put the price up to 60p and you sold 15 instead of 20 (starts working on a calculator).
T How would you increase profits?
P5 Advertising
T How would that affect profits?
P5 You would attract people and they would buy more and that would boost profits?
T Anything else?
P5 You could us e a questionnaire…find out what people want more of and what they want less of.
T How would that affect profits?
P5You could see what people want mopre of and stock more of that and less of the other stuff. Then you would sell more and make more profit.
TIs there any connection between these two examples in what leads to more profit?
P5Yeah. It’s about attracting more customers and then you sell more.
T Anything else that could affect profits?
P5 You could put the price up or maybe buy in bulk and then you would get the drink cheaper.
Later…
T Can I go back to your first example, using advertising. Tell me again why that would increase profit.
P5 You would get more customers and you would sell more, so more profit.
TSo how do you calculate profit?
P5You take the variable cost away from the revenue?
TAnd?
P5Fixed costs as well.
TSo is the advertising going to be free?
P5No it will add to fixed costs, running costs?
TWhich one do you think?
P5To fixed costs because it won’t change if you sell more.
The article suggests an interpretation of how these conversations suggest different conceptions of profit. However, there are also points in the conversations where different questions might have yielded richer evidence from the students. For example, in the first couple of conversations the teacher relies heavily on the prompt ‘anything else’ but in later conversations there are more questions of the form ‘can you explain that?’ So the conversations provide a stimulus for thinking about the prompts to use in these conversations as well as the different conceptions students might hold.