Startup Wars · Classroom teaching resource
The food truck inventory decision
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An original illustrative classroom exercise, not a simulation screenshot or software result. All numbers below are teaching assumptions.
Name:
Class / date:
Your decision
You are preparing a food truck for one event. Choose to stock 40 meals or 60 meals. Each meal sells for $10 and costs $4 to prepare. The event fee is $100. You pay for all meals prepared. Unsold meals cannot be resold. Assume no other costs and no ability to restock.
Demand could be 30 meals or 60 meals. You do not know which outcome will occur.
- Before calculating: Which quantity would you stock, and why? State your demand assumption.
- Compare the outcomes: Meals sold = the smaller of demand and stock. Profit = (meals sold × $10) − (meals prepared × $4) − $100.
| Demand | Stock 40: profit | Stock 60: profit |
|---|---|---|
| 30 meals | ||
| 60 meals |
- Explain the tradeoff: What do you risk by ordering too many? What do you give up by ordering too few?
- Revise with evidence: What information would help you choose? Explain whether it would change your original decision.
Instructor copy
Answer key & discussion guide
Learning objective: Explain how uncertain demand creates a tradeoff between inventory waste and missed sales, using a simple profit calculation.
Suggested preparation: Review revenue, fixed costs, variable costs, and profit. Learners may work individually or discuss in pairs; this is a classroom choice, not a software access instruction.
| Demand | Stock 40 | Stock 60 |
|---|---|---|
| 30 meals | $300 − $160 − $100 = $40 | $300 − $240 − $100 = −$40 |
| 60 meals | $400 − $160 − $100 = $140 | $600 − $240 − $100 = $260 |
Facilitate the debrief
- Invite students to commit to an initial choice before sharing the outcomes.
- Ask why the lower-stock choice performs better with low demand, but worse with high demand.
- Discuss useful evidence: comparable event sales, expected attendance, competing vendors, and weather.
- There is no universally correct initial choice without a demand assumption or risk preference. Assess the reasoning rather than guessing the “winning” outcome.
Suggested assessment: 8 points
- Calculations (0–2): 2 for four correct outcomes with workings; 1 for mostly correct method; 0 for no usable method.
- Tradeoff (0–2): 2 explains both waste and missed sales; 1 explains one; 0 explains neither.
- Evidence (0–2): 2 identifies relevant evidence and how it informs demand; 1 names evidence without explanation; 0 provides none.
- Revision (0–2): 2 justifies keeping or changing the choice; 1 states a choice without sufficient reasoning; 0 gives no response.
College extension: Let p be the probability of demand reaching 60 meals. Expected profit is 40 + 100p for stocking 40 and −40 + 300p for stocking 60. The choices break even at p = 0.4. Ask what evidence supports a probability estimate and why expected profit alone may not determine a decision.
Adapt the task and rubric to your learners. This resource has not been validated as a learning-outcome study and does not specify software timing, built-in grading, or standards alignment.
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