Human capital provides social benefits as well. Which of the following statements show this?
Answer & explanation
Correct answer: option 4
The correct answer is Option 4: Both 1 and 3
Human capital benefits not only the owner but also the society in general. This is called external benefit. An educated person can effectively take part in a democratic process and contribute to the socio-economic progress of a nation. A healthy person, by maintaining personal hygiene and sanitation, stops the spread of contagious diseases and epidemics. Human capital creates both private and social benefits.
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Statement 1 is true because an educated person can contribute to democratic processes and socio-economic progress, which reflects the social benefits of human capital.
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Statement 3 is also true because a healthy person who maintains personal hygiene helps prevent the spread of diseases, benefiting society at large.
Statement 2 This statement is about the difference between human capital and physical capital. It doesn't directly relate to the social benefits of human capital.