Formula pricing of class 1 milk in the Boston milkshed

Thesis (M.A.)--Boston University, 1950The aim of this thesis is to point out the defects of the Class I milk price formula inaugurated in the Boston Federal milk market April 1948. This formula has three general features, one of which is a formula index derived by taking simple average of the Bureau of Labor Statistics United States Wholesale Commodity Price Index, the Index of Department Store Sales in the Federal Reserve District of Boston and the Grain-Labor Index computed by the Boston Federal Milk Advertising Administrator's Office. Each of these indices are averaged. The resulting formula index is multiplied by the base period price of $3.19 to obtain the minimum basic price that can be paid the producer for Class I milk. A seasonal provision in the formula provides for the payment of seasonal price differences to the producer in order to achieve less seasonal fluctuation in the production of milk than existed during and immediately after World War II. The third feature, a safeguard, in the demand-supply provision which provides for the reducing or increasing of the price of Class I milk price whenever the percentage of surplus milk to total milk in the Boston market exceeds an upper limit of 41 percent or goes below a lower limit of 53 percent