Good joke.
Most probably, this six year old kid was in India (education even at the primary level is quite intensive in India - hence, this example), and a precocious kid. If this kid were to be in Japan, or Finland or some.other countries, (s)he would not have heard much about failing until fourth grade or higher.
By the way, what would have this kid surmised for "M"?
Coming soon - Poll: What is the appropriate age to discuss this topic with a child?