In metropolitan areas, almost 60 percent of all fires are set by child

(A) Most children who believe there will no consequences if they are discovered playing with fire do play with fire
Say, there are in total 100 children, ALL of them believe that there will be NO consequences and 20 of them DO play with fire. Then, there are nevertheless 80 children who believe so but DO NOT play with fire. Eliminate (A).

(B) Parents who discover their children playing with fire will prevent those children from playing with fire in the future.
We do not know what the parents will do AFTER they catch their children playing with fire. (they may instruct their children to play with fire safely.) Eliminate (B).

(C) If parents have successfully instilled in their children the belief that there will be consequences if they are caught playing with fire, these children have not been among those playing with fire.
While 40% of children in rural areas play with fire and 60% of children in metropolitan areas do so, ALL children WHO play with fire BELIEVE that there will be NO consequences. This means that their BELIEF that there will be NO consequences induces the children to play with fire. Hence, if parents have successfully instilled in their children the belief that there will be consequences, their children will not play with fire. Keep (C).

(D) Children who play with fire attach no sense of right or wrong to this action.
It is possible that the children who play with fire know that doing so is wrong but because they believe that there will be NO consequences, they play with fire. Eliminate (D).

(E) Most children who do not play with fire believe there will be consequences if their parents discover them playing with fire.
We know that children who DO play with fire believe that there will be NO consequences, but we do NOT know about what the children who DO NOT play with fire BELIEVE. They may believe that there will be NO consequences but they still DO NOT play with fire (maybe simply because they do not like it). Eliminate (E).

(C) is correct.­