Abstract
In a recent article in this journal, Stonehouse and MacGregor outlined several elements of the farm level decision to purchase milk quota. They provide a useful reminder that, because quota is an asset, decisions regarding its purchase or sale should be undertaken and analyzed with capital budgeting techniques. More specifically, they describe procedures for calculating the net flow return from additional quota under different cost circumstances and the subsequent bid price which that farm could pay for the quota asset. It is the purpose of this comment to show that errors of both commission and omission have found their way into the paper. In addition, there is a problem of inconsistency because the text and the actual calculation formulae are sometimes contradictory.
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