This document summarizes Slutsky's analysis of how a price change affects consumer demand. It explains that a price change has both a substitution effect and an income effect on demand. For normal goods, the substitution and income effects reinforce each other, leading to a downward sloping demand curve. For inferior goods, the effects oppose each other, and in rare cases of extreme inferiority (Giffen goods), the income effect can outweigh the substitution effect, causing demand to increase as price rises. Slutsky's analysis uses budget constraints to isolate the substitution and income effects.