ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Human capital is not perfectly mobile between countries as movement is restricted by nationality and culture. It is intangible, it cannot be sold in the market only the services of human capital are sold and hence the necessity of the owner of the human capital to be present in the place of production.

Detailed explanation-2: -Human capital is a stock concept because we are talking about a particular point of time whereas human capital formation is a flow concept because we are adding to the stock of human capital by developing new skills, training etc.

Detailed explanation-3: -Human capital refers to the skills and knowledge possessed by an individual. Human capital formation can be increased by investing more in education sector and promoting the importance of gaining knowledge and skill. By doing this, national income of a country rises up. Hence, correct answer is option D.

Detailed explanation-4: -Human capital allows an economy to grow. When human capital increases in areas such as science, education, and management, it leads to increases in innovation, social well-being, equality, increased productivity, improved rates of participation, all of which contribute to economic growth.