8.Data on price of Y, quantity demand for X when income is 100, and quantity demand for X when income is 200 are given in the following table. The price of X is fixed at $7.

Py QDx (Income$100) QDx (Income$200)

0 114.5 46.5

1 115 47.8

2 115.5 49.1

3 116 50.4

4 116.5 51.7

5 117 53

6 117.5 54.3

7 118 55.6

8 118.5 56.9

9 119 58.2

10 119.5 59.5

a. Calculate income elasticity of demand for X using the midpoint method when income increases from $100 to $200 and when price of Y is fixed at $9.

Explain your answer.

b. Calculate cross price elasticity of demand for X when price of Y decreases from $9 to $8 and when income is $100. Explain your answer.