Indian Economic Development

Ch 4 Human Capital Formation in India

Class 11 • Indian Economic Development

NCERT Class 11 Economics Chapter 1 Questions (MCQ, One-Word or Descriptive)

This page provides complete NCERT Class 11 Indian Economic Development Chapter 4 questions, including MCQs, one-word and descriptive questions. All questions are extracted line-by-line from NCERT for full syllabus coverage and exam preparation.

This chapter, Human Capital Formation in India, explains that just as physical resources can be turned into physical capital, human resources can be transformed into human capital through investment in education, health, on-the-job training, migration, and information. Human capital enhances labour productivity, stimulates innovation, and facilitates adaptation to new technologies.

The chapter draws a crucial distinction between physical capital (tangible, separable, mobile, private benefit) and human capital (intangible, inseparable from owner, less mobile, creates both private and social benefits). It also clarifies the difference between human capital (treating education/health as means to increase productivity) and human development (treating education/health as ends in themselves for human well-being).

The National Education Policy 2020 is highlighted for its vision of preparing India for a knowledge economy driven by advances in AI, data science, climate science, and multidisciplinary learning. Empirical data from 1951 to 2022 shows significant progress: literacy rates rose from 16.67% to 78%, infant mortality declined from 146 to 28 per 1,000, and life expectancy improved considerably.

However, challenges remain. Education expenditure as a percentage of GDP is still only a little over 4% against the recommended 6% (Education Commission 1964-66). Regional disparities are stark : per capita public expenditure on elementary education ranges from Rs 96,968 in Sikkim to Rs 10,710 in Bihar. The Indian education pyramid remains steep, with fewer people reaching higher education, and unemployment among educated youth : especially rural female graduates (30% as per 2011-12 NSSO data) : is a serious concern.

The Right to Education Act (2009) made free education a fundamental right for children aged 6-14, yet universal literacy remains a distant goal. The chapter concludes by emphasising the need for qualitative improvement, gender equity, and government intervention to regulate private providers and ensure access for disadvantaged sections.

Section A: Descriptive Questions

  1. What is human capital? Page 60
  2. What are the main sources of human capital formation? Page 60-61
  3. Explain the difference between human capital and physical capital. Page 62
  4. Why is expenditure on health considered an important source of human capital formation? Page 60-61
  5. What is the difference between human capital and human development? Page 66
  6. Why is government intervention necessary in education and health sectors? Page 67
  7. What does the Right of Children to Free and Compulsory Education Act (2009) provide? Page 69
  8. What are the two ways government expenditure on education is expressed? Page 68
  9. What was the recommendation of the Education Commission (1964-66) regarding education expenditure? Page 69
  10. What is the education cess? Page 69
  11. Explain the concept of external benefit in human capital formation. Page 62
  12. How does migration contribute to human capital formation? Page 61
  13. What is the current level of education expenditure as a percentage of GDP in India compared to the desired level? Page 69
  14. Why is promoting women’s education important in India? Page 71
  15. What is the Indian education pyramid? Page 71

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Section B1: Objective MCQs

Page 64

According to the Seventh Five Year Plan, human resources development should be assigned a key role particularly in which type of country?

A) Rich countryB) Large population countryC) Small island countryD) Industrialized country
View Answer
Correct Answer: Large population country
Reference: NCERT Page 64
Page 60-61

Which of the following is NOT a source of human capital formation according to the chapter?

A) EducationB) HealthC) Construction of roadsD) On-the-job training
View Answer
Correct Answer: Construction of roads
Reference: NCERT Page 60-61
Page 62

Physical capital is different from human capital because physical capital is

A) IntangibleB) Inseparable from ownerC) Tangible and separable from ownerD) Creates only social benefit
View Answer
Correct Answer: Tangible and separable from owner
Reference: NCERT Page 62
Page 62

Which type of benefit flows to society from an educated person?

A) Private benefit onlyB) External benefit onlyC) Both private and social benefitD) No benefit
View Answer
Correct Answer: Both private and social benefit
Reference: NCERT Page 62
Page 65

What was India’s literacy rate according to Table 4.1 for 2018-22?

A) 16.67%B) 43.57%C) 65.20%D) 78%
View Answer
Correct Answer: 78%
Reference: NCERT Page 65
Page 65

According to Table 4.1, what was the infant mortality rate in 2018-22?

A) 146B) 110C) 63D) 28
View Answer
Correct Answer: 28
Reference: NCERT Page 65
Page 65

According to Table 4.1, life expectancy at birth for females in 2018-22 was

A) 37.2B) 54.7C) 66.9D) 71.4
View Answer
Correct Answer: 71.4
Reference: NCERT Page 65
Page 65

The National Education Policy was introduced in which year?

A) 1986B) 2000C) 2020D) 2023
View Answer
Correct Answer: 2020
Reference: NCERT Page 65
Page 69

Which committee estimated an expenditure of around Rs 1.37 lakh crore over 10 years for elementary education?

A) Education CommissionB) Tapas Majumdar CommitteeC) Kothari CommissionD) National Knowledge Commission
View Answer
Correct Answer: Tapas Majumdar Committee
Reference: NCERT Page 69
Page 68

In 2020-21, which state had the highest per capita public expenditure on elementary education?

A) BiharB) Uttar PradeshC) SikkimD) Kerala
View Answer
Correct Answer: Sikkim
Reference: NCERT Page 68
Page 68

In 2020-21, which state had the lowest per capita public expenditure on elementary education?

A) SikkimB) BiharC) MaharashtraD) Tamil Nadu
View Answer
Correct Answer: Bihar
Reference: NCERT Page 68
Page 71

The Indian education pyramid being steep indicates that

A) Most people reach higher educationB) Fewer people reach higher educationC) Equal distribution at all levelsD) No one reaches higher education
View Answer
Correct Answer: Fewer people reach higher education
Reference: NCERT Page 71
Page 71

As per NSSO data 2011-12, unemployment rate among young rural female graduates was nearly

A) 10%B) 16%C) 19%D) 30%
View Answer
Correct Answer: 30%
Reference: NCERT Page 71
Page 71

As per NSSO data 2011-12, unemployment rate among rural male graduates was

A) 10%B) 19%C) 25%D) 30%
View Answer
Correct Answer: 19%
Reference: NCERT Page 71
Page 67

Which organisation was established to facilitate higher education institutions in India?

A) NCERTB) ICMRC) AICTED) NABARD
View Answer
Correct Answer: AICTE (All India Council of Technical Education)
Reference: NCERT Page 67
Page 67

The National Medical Commission and ICMR facilitate institutions under which sector?

A) EducationB) HealthC) IndustryD) Agriculture
View Answer
Correct Answer: Health
Reference: NCERT Page 67
Page 70

According to Table 4.2, the youth literacy rate for females in 2017-18 was

A) 54%B) 64%C) 82%D) 90%
View Answer
Correct Answer: 90%
Reference: NCERT Page 70
Page 70

According to Table 4.2, the primary completion rate for females in 2017-18 was

A) 61%B) 69%C) 94%D) 96%
View Answer
Correct Answer: 96%
Reference: NCERT Page 70
Page 70-71

In 1950, the Directive Principles of the Constitution stated that free and compulsory education should be provided for all children up to age 14 within how many years?

A) 5 yearsB) 10 yearsC) 15 yearsD) 20 years
View Answer
Correct Answer: 10 years
Reference: NCERT Page 70-71
Page 69

The education cess is levied at what rate on all Union taxes?

A) 1%B) 2%C) 3%D) 5%
View Answer
Correct Answer: 2%
Reference: NCERT Page 69

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Section B2: Factual One-Liners

Name the economist who wrote the book “Human Capital” in 1964. Page 74

Reveal Answer
Gary S. Becker (Page 74)

What is the full form of NCERT? Page 67

Reveal Answer
National Council of Educational Research and Training (Page 67)

What is the full form of UGC? Page 67

Reveal Answer
University Grants Commission (Page 67)

What is the full form of AICTE? Page 67

Reveal Answer
All India Council of Technical Education (Page 67)

What is the full form of ICMR? Page 67

Reveal Answer
Indian Council for Medical Research (Page 67)

What is the full form of GDP? Page 68

Reveal Answer
Gross Domestic Product (Page 68)

What is the full form of IT? Page 66

Reveal Answer
Information Technology (Page 66)

According to Table 4.1, what was the crude death rate per 1,000 population in 2018-22? Page 65

Reveal Answer
6 (Page 65)

According to Table 4.1, what was the real per capita income (in Rs) in 2018-22? Page 65

Reveal Answer
94,054 (Page 65)

Which organisation conducts the Periodic Labour Force Survey? Page 71

Reveal Answer
Periodic Labour Force Survey (PLFS) / NSSO (Page 71)

Name the education policy of 2020 mentioned in the chapter. Page 65

Reveal Answer
National Education Policy 2020 (Page 65)

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This post was last modified on May 5, 2026 9:40 pm