Read the following statements - Assertion (A) and Reason (R): Assertion: Expenditure on health is an important source of human capital formation. Reasoning: A sick labourer without access to medical facilities is compelled to abstain from work. From the given alternatives choose the correct one:

Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A). Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct explanation of Assertion (A). Assertion (A) is true but Reason (R) is false. Assertion (A) is false but Reason (R) is true.

Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of Assertion (A).

A sick labourer without access to medical facilities is compelled to abstain from work and there is loss of productivity. Hence, expenditure on health is an important source of human capital formation. It is only when expenditure on health is made that an individual will attend work and gather knowledge, skills and experience that constitute human capital. Health expenditure directly increases the supply of healthy labour force and is, thus, a source of human capital formation.