J.B.
You should ask her what she thinks sex is. Find out how much information (or misinformation) she has and where she got it. Try to stay calm and non-judgemental. Let her know she can always come to you with any question she has about sex or other things. Help her feel safe in talking to you and not shamed or worried about getting in trouble. Depending on how much she already knows, you can fill in the gaps and answer her questions. Let her know that sex is an adult activity that has serious repercussions (blah, blah, blah in accordance with your particular beliefs). Be thankful that she has opened the door for this conversation. Most of us agonize over when to start "the talk". If you don't answer her questions, god only knpws where she'll find the info and if it will be true.