16 



MASS. EXPERIMENT STATION BULLETIN 389 



Among the handlers who used only one truck in the collection of their supplies, 

 a great variety of rates existed. The surprising fact is perhaps that there was not 

 even more variation. There were 34 routes in this group and only 18 different 

 rates. A situation of this sort might suggest either the absence of any attempt to 

 determine cartage rates based exclusively on cost, or the impossibility of so doing. 



Producers 37 Price at the Market 

 according to Settlement Plon 



I Producer's Ust 37 Price | 



iButterfot DifferentioF] 



Quality Differential 

 I 



I Producer's Net Price | 



Figure 4. Schematic Diagram Showing Methods by Which Producers' Prices Are Determined 



PART II 

 VARIATION IN PRICES RECEIVED BY DAIRYMEN 



As part of the general appraisal of the Springfield milk supply, a study was made 

 of the characteristics of prices received b>- farmers. The objectives were several. 

 In the first place, it seemed desirable to systematize the prices with which farmers 

 had to deal. Secondly, it was essential that some appraisal be made of the relative 

 importance of price per se. Thirdly, if variation was a markedly apparent charac- 

 teristic there was need of determining, so far as possible, the extent, the effect, 

 and the probable causes of it. 



The cash value at the farm per hundred pounds of milk is, in the final analysis 

 the price in which the farmer is interested. That is the actual return per hundred- 

 weight for the product which he has to sell; from it his income is derived and 

 out of it his expenses are met. 



This assertion is not made with any intent to minimize the importance of trans- 

 portation charges, market-service charges, class prices, butterfat differentials, 



Acknowledgment: Mr. Alfred H. Planting, a former graduate student, assisted materially with 

 the planning and development of this aspect of the study. 



