Milk Wars

5 03 2011

http://www.theaustralian.com.au/news/nation/milk-wars-could-cost-suppliers-730m/story-e6frg6nf-1226015592216

In Australia, big dairy and milk supplying companies have lost close to $730 million dollars. This is caused by the demand determinant: “Prices of Substitute Goods”. Many Australian supermarkets have significantly dropped the price of generic, no-name brands milk to $1 per liter. This decrease in the price of generic, no-name brand milk caused consumers to be less willing to buy its substitute good (which is brand named milk from big dairy supplying companies). This change in price caused a shift in demand to the left.  This results in a decrease in price and production of milk by big companies.

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