Consider the following statements: Human capital formation as a concept is better explained in terms of a process which enables 1. Individuals of a country to accumulate more capital. 2. Increasing the knowledge, skill levels and capacities of the people

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Q: 34 (IAS/2018)
 Consider the following statements: Human capital formation as a concept is better explained in terms of a process which enables
1. 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?

question_subject: 

Economics

question_exam: 

IAS

stats: 

0,81,51,12,33,81,6

keywords: 

{'human capital formation': [0, 0, 0, 1], 'accumulation': [1, 0, 0, 4], 'intangible wealth': [0, 0, 0, 1], 'tangible wealth': [0, 0, 0, 1], 'more capital': [0, 0, 0, 2], 'capacities': [0, 0, 1, 1], 'skill levels': [0, 0, 0, 1], 'concept': [8, 3, 5, 11], 'process': [16, 0, 12, 37]}

The concept of human capital formation is primarily concerned with enhancing the knowledge, skills and capacities of a country`s people (statement 2), and accumulating intangible wealth such as education, health, and other skills (statement 4).

Option 1 and 3 do correlate with the concept but they are not entirely correct. Statement 1, "Individuals of a country to accumulate more capital" is somewhat off because human capital formation centers on enhancing human capabilities and potentials, not just individual accumulation of more capital. Statement 3 "Accumulation of tangible wealth" refers primarily to physical assets like land, buildings, machinery, etc., not to human abilities, knowledge and skills.

Therefore, the correct answer is option 3 "2 and 4 only", as these two statements best explain what human capital formation is about: enhancing people`s sundry capacities and accumulating intangible wealth.