Question

true or false also give reason :
human capital formation creates physical capital

Answer 1

Dear Student,
It is TRUE, that human capital formation creates physical capital.

Reason :-
Physical capital consists of all the means of production that go towards producing goods and services. This capital can be in the form of plants and machinery, or services.
The product of physical capital goes towards satisfying the needs and requirements of human beings, otherwise known as the human capital.
However, to be able to produce these goods and services, human beings must have acquired the necessary skills, experience and the technical know-how. Being the brain behind the effective use of physical capital, humans use acquired skills and expertise to produce the required output. Being the cause behind the physical output, human beings can be regarded as the human capital.

Therefore, it is the human capital which ultimately creates physical capital.

Regards