Suppose the incomes of buyers in a market for a particular normal good decrease and there is also a reduction in input prices. What would we expect to occur in this market?

an indeterminate effect on equilibrium quantity and a fall in equilibrium price.

Explanation:

A normal good is a good whose demand increases when income increases and falls when income falls.

If income falls and the good is a normal good, demand would fall. This would lead to a fall in price and quantity.

If cost of input falls, the cost of production would fall and supply would increase. This would lead to an increase in quantity and a fall in price.

The combined effect would an indeterminate effect on equilibrium quantity and a fall in equilibrium price.

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