Refer to the Accompanying Table A Calculate the Price Elasticity of Demand When the Price

Essay

Refer to the accompanying table. $$\begin{array} { | l | c | c | } \hline \text { Price } & \begin{array} { l } \text { Quantity of } \\\text { Televisions } ( \mathbf { Y } \\= \mathbf { 2 0 , 0 0 0 } )\end{array} & \begin{array} { l } \text { Quantity of } \\\text { Televisions } ( \mathbf { Y } \\\mathbf { = 3 0 , 0 0 0 0 ) }\end{array} \\\hline \$ 350 & 250 & 375 \\\hline \$ 450 & 200 & 325 \\\hline \$ 550 & 150 & 275 \\\hline \$ 650 & 100 & 225 \\\hline \$ 750 & 50 & 175 \\\hline\end{array}$$
a. Calculate the price elasticity of demand when the price rises from $450 to $550 for an individual income of $20,000.
b. Is demand elastic or inelastic? Explain your answer to the elasticity of demand you calculated in part (a) and include the mathematical equation used to find it.