Holding supply unchanged, an increase in the demand for a normal good will cause the equilibrium price and equilibrium quantity to:

1. A rightward shift of demand creates excess demand at the old price. 2. The shortage pushes the price up, and the higher price draws out more supply. 3. At the new equilibrium both price and quantity are higher. 4. Hence both rise, so option A is correct. _Source: ICAI BoS CA Foundation Paper 4 Business Economics, Ch 4 Unit II "Determination of Prices", p.3_