"As physical capital is essential for economic development so is human capital." Explain.

**Answer:** - i. When existing human resource is further developed by becoming more educated and healthy, human capital formation adds to the productive power of the country. - ii. Investment in human capital formation yields higher returns by yielding larger output. - iii. It improves the social outlook of workers and helps increase labour mobility. - iv. It raises the standard of living by increasing incomes. - v. Society gains indirectly because advantages spread to those not directly educated or given health care.