WESTERN FAMILY NONFAT DRY MILK 3
WesternFamily Nonfat Dry Milk
The is a nutritious milk product producedby one of the best diaries in the country. People can take it as puremilk or cook various types of foods including baking. It is highlypreferable because of its low fat and calorie content. Its price iswithin the range of other milk products of the same quantity.
Itis notable that the demand of the Western Family Milk product iselastic. This means that its increase or decrease in price impactsgreatly on the demand. The product follows unitary demand in whichcase the increase in prices results to a reduction in demand. On theother hand, its reduction in price leads to a simultaneous increasein demand. This is because the product has many substitutes thus,when the price of Western Family milk increases, people will seekalternatives of the same. This would be more so if the alternativesare cheaper than the western family. Likewise, it is not also abasic product and many would still do without it. Some of the peoplewho take this product may decide to reduce the quantity that theyused previously or even decide to do without it.
Accordingto Mankiw (2009), most consumption goods that have multiplesubstitutes tend to have a unit elastic type of demand. Further, thisis more likely when the product is bought on regular basis. Thewestern family, which is bought regularly and has many substitutes,is not exempted from unit elastic demand. The producers should havethis in mind when contemplating to increase or decrease its price. Itwould be more profitable to remain within the price range of othersubstitutes.
Mankiw,N. G. (2009). Principlesof economics.Mason, OH: South-Western Cengage Learning.