Point D in Figure 1.3 represents: a. an inefficient use of resources. Ob. full employment. c. a combination of consumer and capital products that may be obtainable sometime in the future, but is impossible to produce now. Od economic growth. e. a combination of products that can be produced only if resources are fully and efficiently employed.

Manisha could work for another firm making $10,000 per month, but she decides to open her own gourmet cheese store and pay herself $2,000 per month. In her first month of operations, she spends $6,000 on cheese, $1,000 on other items, and $2,500 on rent. She had a great opening month, and brought in revenues of $13,500. What are Manisha's economic profits? A. $4,000 B. - $5,000 C. $3,000 D. - $6,000

Suppose the standard of living is accurately measure by real GDP per capita. Then, ceteris paribus, which of the following would unambiguously promote long-run growth in the standard of living? Oa. Inflation O b. Unemployment c. Population growth O d. Education Next page

10. Labour-saving technical progress means a) that marginal productivity of capital increases. b) that marginal productivity of labour increases. c) that marginal productivity of both inputs increases. d) None of the above is correct. CHOOSE ONE ANSWER ONLY.