Consider the following statements:Human capital formation as a concept is better explained in terms of a process which enables1.individuals of a country to accumulate more capital.2.increasing the knowledge, skill levels and capacities of the people of the country.3.accumulation of tangible wealth.4.accumulation of intangible wealth.Which of the statements given above is/are correct?

1. A

   1 and 2

   (a) 1 and 2. Knowledge and skills (2) are human capital; accumulating more physical capital (1) is not. Pairing them is not the key.

2. B

   2 only

   (b) 2 only. Statement 2 is necessary but incomplete: human capital is also intangible wealth (4). Isolating 2 misses 4, so this is not the key.

3. C

   2 and 4

   (c) 2 and 4. (c) Official key: Human capital formation raises knowledge, skills and capacities and thereby accumulates intangible wealth. Tangible capital and ‘more capital’ in the physical sense are not the concept. 2 and 4 is the stored key.

4. D

   1, 3 and 4

   (d) 1, 3 and 4. Statements 1 and 3 describe physical/tangible capital, which is not human capital. This is not the key.

Summary. Official key is (c) 2 and 4. Human capital is embodied skill and knowledge—intangible productive wealth. Plant, machinery and financial capital are different stocks. Honour the stored letter (c).