Which of the following statement/statements are true?
Statement 1: Just as a country can turn physical resources into physical capital like factories, similarly, it can also turn human resources into human capital.
Statement 2: We need good human capital to produce other human capital.
Answer & explanation
Correct answer: option 1
The correct answer is Option 1: Both the statements are true
Just as a country can turn physical resources like land into physical capital like factories, similarly, it can also turn human resources like nurses, farmers, teachers, students into human capital like engineers and doctors. Societies need sufficient human capital in the first place—in the form of competent people who have themselves been educated and trained as professors and other professionals. In other words, we need good human capital to produce other human capital (say, nurses, farmers, teachers, doctors, engineers, etc.).