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Technological improvements and reduced equipment costs have

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Manager
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Joined: 21 Feb 2012
Posts: 117
Location: India
Concentration: Finance, General Management
GMAT 1: 600 Q49 V23
GPA: 3.8
WE: Information Technology (Computer Software)
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Kudos [?]: 23 [0], given: 15

Technological improvements and reduced equipment costs have [#permalink] New post 22 Apr 2012, 04:01
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A
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C
D
E

Difficulty:

  5% (low)

Question Stats:

59% (01:33) correct 40% (01:20) wrong based on 32 sessions
Technological improvements and reduced equipment costs have made converting solar energy directly into electricity far more cost-efficient in the last decade. However, the threshold of economic viability for solar power (that is, the price per barrel to which oil would have to rise in order for new solar power plants to be more
economical than new oil-fired power plants) is unchanged at thirty-five dollars.

Which of the following, if true, does most to help explain why the increased cost-efficiency of solar power hasnot decreased its threshold of economic viability?

A. The cost of oil has fallen dramatically.
B. The reduction in the cost of solar-power equipment has occurred despite increased raw material costsfor that equipment.
C. Technological changes have increased the efficiency of oil-fired power plants.
D. Most electricity is generated by coal-fired or nuclear, rather than oil-fired, power plants.
E. When the price of oil increases, reserves of oil not previously worth exploiting become economicallyviable.

Can someone explain this one...? :roll:
[Reveal] Spoiler: OA
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Re: here is a good one [#permalink] New post 23 Apr 2012, 01:58
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Re: here is a good one [#permalink] New post 24 Apr 2012, 05:16
Its a cause effect CR. Its assumed that the improvement in efficiency of solar power conversion to electricity will have an effect that threshhold price for oil decreases. If we reverse the relation we should be fine to explain the paradox. Hence C.
Re: here is a good one   [#permalink] 24 Apr 2012, 05:16
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