The trick is to have at least one cube inside two cups at the same time. Here is one of several solutions. Place 7 cubes in one cup and set it aside. Place 2 cubes in another cup. Then place 1 cube in the last cup and nest the cup inside the cup containing 2 cubes. There are 7 cubes in the first cup, 3 cubes in the second cup, and 1 cube in the third cup.