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Answer the following. (Class 12 Economics 2026, Q32b)

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EconomicsCBSE Class 12 · Board exam 2026, set 58/5/1 · 4 marks · Long answer

CBSE Class 12 Economics 2026: question 32(b)

Set in the CBSE Class 12 board exam of 2026, paper 58/5/1, section B, question 32(b), for 4 marks. Try it first; the hints and our step-by-step solution are below.

Q32(b) · 4 marks · Long answerHuman Capital Formation in India

Answer the following.

  1. (i)

    Define 'Human Capital Formation'.

    1 mark
  2. (ii)

    Explain 'Expenditure on migration' as a source of human capital formation.

    3 marks

Source: official question paper from cbse.gov.in (PDF). See it in the full 2026 board paper, set 58/5/1.

Hints

Open one hint at a time and try again before the next.

Hint 1

Human capital = skills, knowledge, health.

Hint 2

Why would someone pay the costs of moving?

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. (i) Human capital formation is the addition to the stock of human capital (the skills, knowledge and health of people) over a period of time.

    1 mark

  2. (ii) People migrate in search of better jobs and higher earnings; for example, engineers and doctors move to places with better opportunities. Migration has costs: transport, a higher cost of living in the new place and the psychic cost of adjusting to a new social setup. Because the higher earnings at the new place outweigh these costs, spending on migration raises the productive use of people's skills and is a source of human capital formation.

    3 marks

Answer: (i) Addition to the stock of human capital over time. (ii) Migration costs are an investment that lets skills earn more, so it builds human capital.

Where the marks are

  • Definition (1)
  • Migration as a source of human capital (marked as a whole, 3)

Revise the chapter

Practise this chapterBoard-style questions from Human Capital Formation in India, one at a time, marked against the answer key and marking points.Back to the full paper2026 board paper, set 58/5/1: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.