Discuss the income and substitution effects of a price change in case of a normal good.

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Discuss the income and substitution effects of a price change in case of a normal good.

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Use the formula for the two demand curves to compute the quantity demanded shown by each curve at a price of $17.
If the movement of the supply curve for the product took place, but the price failed to adjust to the new level of market equilibrium, which one of the following would likely be witnessed in the market for the product? A. The new market price does not need to adjust, as the price can remain constant and the market will still be in equilibrium. B. There will an excess supply in the market. C. The price is not a significant factor in determining the market equilibrium. D. There will be excess demand in the market.
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