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Price elasticity of demand and income elasticity of demand are two important concepts in microeconomics that measure how the quantity demanded of a good or service responds to changes in its price and changes in consumer income, respectively.

1. Price Elasticity of Demand:
   Price elasticity of demand measures the responsiveness of the quantity demanded of a good to changes in its price. It is calculated using the following formula:

   \[ E_p = \frac{\% \text{change in quantity demanded}}{\% \text{change in price}} \]

   For the given demand function \(Q = 700 - 2P + 0.02y\), where \(P\) is the price and \(y\) is income, let's find the price elasticity of demand when \(P = 25\).

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