# Calculating the income elasticity of demand

The demand function for gadgets is given by the following formula

Q = 1,000 -10Y - 2 P + 4A

where Q is quantity, Y is income, P is price, and A is advertising.

Currently, Y = 20, P = 30, and A is 15

What is the income elasticity of demand?

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Q = 1,000 -10Y - 2 P + 4A

Put P=30 and ...

#### Solution Summary

Solution calculates the income elasticity of demand.

$2.19