Innovations in production technology and decreases in the cost of equipment have made recycling paper into new paper products much more cost-efficient over the last twenty years. Despite these advances, though, the "point of price viability" (the price that new paper made from trees must reach to make recycled paper comparable in price) is unchanged at $2.12 per ream of paper.

Which of the following, if true, most explains why the increased cost-efficiency of recycled paper has not lowered the point of price viability?


A. The cost of unprocessed trees to make new paper has fallen dramatically.

B. The decreases in the cost of recycling equipment have occurred despite increases in the cost of raw materials required to manufacture such equipment.

C. Innovations in production technology have made it much more cost-efficient to produce new paper from trees.

D. Most paper is made from the scraps and sawdust left after processing new trees for lumber, rather than directly from the trees themselves.

E. When the price of planting new saplings to replace cut trees becomes more expensive, forests reserves not previously worth cutting become cost-effective to cut.

C on this one.

Cost in new paper made from tree = Cost to make recycled paper
And we need something why this equation is not achieved even when equipment cost has gone down

A. The cost of unprocessed trees to make new paper has fallen dramatically.

Even if cost have gone down, it doesn't mean processing cost have not gone up for making new paper. A is out

B. The decreases in the cost of recycling equipment have occurred despite increases in the cost of raw materials required to manufacture such equipment.

This actually tells us recycling cost have gone down despite increase in cost of raw materials. Nothing to say that the equation is not balanced. B is out.

C. Innovations in production technology have made it much more cost-efficient to produce new paper from trees.

Here we are told producing new paper is very much cheaper than before. If this is the case, point of cost viability is going to be rather diffcult to meet. C is a good choice.

D. Most paper is made from the scraps and sawdust left after processing new trees for lumber, rather than directly from the trees themselves.

Nothing about cost here as well. Processing cost could be exremely high to begin with. D is out.

E. When the price of planting new saplings to replace cut trees becomes more expensive, forests reserves not previously worth cutting become cost-effective to cut.

Out of scope. E is out.