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2 Submitted to:
Prof. M. A. Baqui Khalily
Course Instructor
Micro Economics
Department of Business Administration,
United International University
2 Submitted By:

2 Mdurtaza Ali Mahmood ID:112101030

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 independent of aid for
10 years expanded milk
production improved cow care and
set an example for private dairies
2 Milk Vita is Bangladesh's largest dairy
company and the leading supplier of
fresh milk and dairy products such as
butter and yogurt to Dhaka. Private
dairies even copy some of Milk Vita's
business model. For the last 10 years
Milk Vita has stood on its own two feet
without subsidies from either the
international community or the
government. In 1998 40 000 farmers
who pay a nominal fee to join the
cooperative earned a total of US$9.3
million through the sale of 30 million
liters of milk. Farmers receive crucial
animal services such as vaccations and
artificial insemination. Dividends
decided by the cooperative flow back to
producers -- in 2000 US$1.5 million
was paid out. The price of milk is set by
the cooperative based on current
demand
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2 2 By plotting on a graph the
2 The inverse price-quantity
relationship (indicating
that a greater quantity of
the commodity is
demanded at lower prices
and a smaller quantity at
higher prices) is called the
law of demand.
2
2 
 
various price-quantity
combinations given by the
market demand schedule
we obtain the market
demand curve for the
commodity. The demand
curve has a negative slope;
that is it slopes downward
to the right. This negative
slope is a reflection of the
law of demand or inverse
price-quantity relationship.
2 D----- 


A (Pown Pcross Income) 2     



2 oere 2 --1. J 
2 D 


ADemand for 2 - If increases Demand curve shifts to the



 right.
2 2 - If decreases Demand curve shifts to the left.
2 Pown A Price of 


 2 2.  



2 Pcross A Price of substitutes & 2 - If the price of the substitute
complementary goods commodity rises or if the price of the
2 complementary commodity falls demand
2 Income A Consumer¶s income. curve shifts to the right.
2 - If the price of the substitute commodity falls
or if the price of the complementary
commodity rises demand curve shifts to the
left.
2 3.     



2 - If increases demand curve shifts to
the right.
2 - If decreases demand curve shifts to
the left.
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|eek Price Quantity

1 48/-Per liter 2.50 Lake liter

2 54/- Per liter 1.80 Lake liter

3 60/- Per liter 1.55 Lake liter

4 66/- Per liter 0.95 Lake liter

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2 Two commodities are substitutes if increase in the price of one of

them leads to more of the other being purchased.
2 Usually there substitute well of powder milk. The purpose of this
experiment we consider powder milk as a Substitute good.
2 .
2
2 Determination of demand and Supply Curve of Substitute Good:
2
2 Price powder milk is less then liquid milk. So if the Demand of
liquid milk increases consumers will prefer powered milk as a
substitute product .Due to preference of the consumers the demand
of powder milk will increase. The demand and supply for powder
milk is shown below:
 
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2 oere 

2 2

2 Income effectA B-C

2 Supply refers to the varying amounts of
a good that producers will supply at
2 Substitution effectA C-A different prices.
2 Total effectA B-A 2
2
2 Income of the ConsumerA 14400tk
2 Price of Milkvita liquid milk (X) A 48tk
2 Price of powder milk(Y) A 72tk
2 Maximum Consumption (X) A 300 unit
2 Maximum Consumption (Y) A 200 unit
2 A (180 80)
2 Price of Milkvita liquid milk increase by
100tk
2 Price of powder milk (X1) A 200tk
2 B (75100)
2 C (90 80)
 

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