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.

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"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 has not 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 costs for 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 economically viable."

(C) Technological changes have increased the efficiency of oil-fired power plants.

Explanation:

Economic viability is able to reveal the degree of acceptance of consumers in relation to a specific product. This viability is important to understand how the product will be received in the market and how profitable or not it can be for those who produce it.

Economic viability is usually greater when the cost and benefit ratio of the product or service is favorable, however this is not always the case.

Regarding the use of solar energy, although technological changes have made the installation and equipment of this type of energy more cost-effective, these technological changes have also increased the efficiency of oil plants. As a result, the economic viability of solar energy has declined.

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