The entrepreneurs consult Alice's older brother Adam, who is studying DAC's in accounting school. Adam tells them:
"You're running this stand for a total of 30 days, right? We give each of you one share a day, and you can trade in any number of shares at any time for a proportional fraction of the basket. We're giving out a total of 60 shares, so each share will be worth 1/60 of a basket."
The next day, Adam's sister Alice is crying and mad at him because, while the stand earned $10 in profits, her lemonade share was only worth $0.17 which wasn't enough to buy either a candy bar or a soda, and this simply didn't seem right to Alice. Adam assured her that the accounting math was solid, although the system might take a long time to reach equilibrium.
Thirty days later, Bob's pretty mad at Adam too, because he can't buy his $150 bike. Bob's 30 shares, cashed in on the last day, were only worth $116.82 while he was expecting to earn $150.
Continued in the next post...