Milk is a local product from farmers everywhere. Most of our oil is on reserve and is an imported product. Most people complain about gas prices, but we pay more for milk.
2006-12-21 23:07:29 · 10 answers · asked by mreyes85 1 in Social Science ➔ Economics
Gasoline is a luxury good, its elasticity of demand is quite large, and the price of gasoline depends on many factors.
Milk on the other hand is a necessity, therefore people are ready to pay for it as much as it takes - the elasticity of demand basically equals to nothing. And the producers of course take advantage of the fact by raising the price of milk much higher than it should be..
Helped?
2006-12-21 23:14:07 · answer #1 · answered by Petra 4 · 0⤊ 0⤋
Economies of scale. Durability of the product. As for why milk is a local product. Because it doesn't last long and will go bad. Also you are caring for live animals and who carry a large cost to feed.
As far as complaints about the price. I use a liter of milk a week and can easily just use none. I use about 50x that amount in gas.
2006-12-22 15:33:30 · answer #2 · answered by JuanB 7 · 0⤊ 0⤋
Like anything else it's a result of supply and demand. Furthermore the supply curve is based largely on the costs of producing milk, which is higher than producing oil. Oil is produced and supplied in far larger volumes than milk, and so milk is more labor intensive per gallon.
2006-12-22 11:00:34 · answer #3 · answered by KevinStud99 6 · 0⤊ 0⤋
You can buy milk 1.99 a gallon and gas around 2.10-2.60 a gallon here in Seattle so milk is actually cheaper. Big Jay.....ever check a gas station...you can buy milk there cheaper than grocery stores.
2006-12-22 07:09:19 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Only in America...
The rest of the world actually needs to pay real money for gasoline. Like $5.00 a gallon.
2006-12-22 11:29:06 · answer #5 · answered by Aussies-Online 5 · 0⤊ 0⤋
Every thing gets down to the equilibrium between quantity supplied and quantity demanded
2006-12-22 11:43:17 · answer #6 · answered by Anonymous · 0⤊ 0⤋
you buy less milk at a time
more demand for gas
Milk is not 1.99 in Seattle it around 3.08 a gallon
check out this site lot of info on milk prices
http://www.ams.usda.gov/dyfmos/mib/rtl_milk_prices.htm
2006-12-22 07:12:02 · answer #7 · answered by Anonymous · 0⤊ 1⤋
cause it takes gas to get it to the shop. and the farmers are greedy
2006-12-22 07:10:18 · answer #8 · answered by Chris C 2 · 0⤊ 0⤋
It should be expensive sooner or later because it has no substitute to replace it.
2006-12-22 07:16:14 · answer #9 · answered by kigrawi 3 · 0⤊ 0⤋
cows run on gas.lol
2006-12-22 12:33:26 · answer #10 · answered by Truth bearer 3 · 0⤊ 0⤋