Suppose that you estimated the following demand curve.
Q = 400 - 6P + .005I
Q represents quantity demanded, P represents price and I represents average income. You know that the current market price is $20 and average income is $20,000
(a) find out current quantity demanded.
(b) find out the price elasticity of demand using the point elasticity formula. Please show your calculations
(c) find out the income elasticity of demand using the point elasticity formula. Please show your calculations.