Introduction:
The correct answer is option 'B' which is Punjab. Punjab is a state located in the northern part of India. It is known for its rich history, vibrant culture, and agricultural prosperity.

Explanation:
Punjab has a literacy rate of 76.70%. The literacy rate is the percentage of people aged 7 and above who can read and write with understanding. It is an important indicator of educational development and human resource potential in a state or country.

Factors affecting literacy rate:
Several factors contribute to the literacy rate of a state. Some of the key factors that may have influenced Punjab's literacy rate are:

1. Government Initiatives: The Punjab government has implemented various initiatives and programs to promote education and literacy in the state. These include the establishment of schools, scholarships, and adult education programs.

2. Educational Infrastructure: The presence of a well-developed educational infrastructure, including schools, colleges, and universities, plays a crucial role in improving literacy rates. Punjab has a good network of educational institutions, including government and private schools, colleges, and universities.

3. Socio-economic Factors: Socio-economic factors such as income levels, employment opportunities, and social norms also influence literacy rates. Punjab has a relatively higher per capita income compared to other states, which may contribute to better access to education and higher literacy rates.

4. Gender Equality: Gender equality and empowerment of women are important factors in improving literacy rates. Punjab has made significant progress in this area by promoting education for girls and women through various government schemes and initiatives.

5. Awareness and Importance of Education: The awareness and importance given to education by the people and society also contribute to the literacy rate. Punjab has a strong cultural emphasis on education, and people generally value the importance of being literate.

Conclusion:
Punjab, a North Indian state, has a literacy rate of 76.70%. This can be attributed to various factors such as government initiatives, educational infrastructure, socio-economic factors, gender equality, and the awareness and importance given to education in the state.