Q7 - If cold fusion worked

[shirando21]

I was able to narrow down to C and E, I picked E.

Can anyone explain why C is better?

Thanks.

[sch6les]

I was able to narrow down to C and E, I picked E.

Can anyone explain why C is better?

Thanks.

(E) resolves the paradox. (C) doesn't.

Take the opposite of (E): if personnel costs were related to the type of raw material used, then using different raw materials would mean different personnel costs. Assuming personnel costs factor into the residential bill, then different personnel costs means different residential bill amounts.

Yet, the stimulus states that residential bill amounts are not all that different no matter what raw material is used. So from this we can infer that personnel costs are not all that different no matter what raw material is used. (E) sums this up.

[shirando21]

We are expecting that replacing all the traditional electric generators that use these fuels with cold-fusion power plants would result in a significant reduction (much more than 25%) in the average residential electric bill. But it only reduce 25%.

Is this the discrepancy?

I think if the personnel costs matters, then it resolves the discrepany. But E says,it is unrelated. I don't see how the opposite helps to resolve the discrepancy...

[maryadkins]

We are expecting that replacing all the traditional electric generators that use these fuels with cold-fusion power plants would result in a significant reduction (much more than 25%) in the average residential electric bill. But it only reduce 25%.

Is this the discrepancy?

Yes!

(E) helps resolve the discrepancy, because it means the personnel costs aren't affected. So suppose that personnel costs are the bulk of what's covered by consumers' bills. Then it doesn't matter what kind of energy is used; their bills aren't going to go down much.

(C) is irrelevant because the question is about what happens after we replace all the old generators with cold-fusion technology. So most companies being willing to do anything doesn't matter.

(A) is straightforward--it'd be more expensive!

(B) gives us another way $ will go up with CF tech.

(D) is another version of (E).

[shirando21]

Only when personnel costs are unrelated means personnel costs is a large portion of any residential electric bill, then E makes sense, because if personnel costs constitute 80-90% of the whole cost, then no matter how much cost the cold-fusion can save the material cost, it does not matter to the whole cost too much.

If E is worded as personnel costs are related to..., it could still resolve the discrepancy, if the cold-fusion can reduce the personnel costs a lot, it may still reduce the bill a lot.

So, I think E means personnel costs is a large portion and it is not changing no matter you use the old materials or the new inexpensive materials, because material cost is only a small portion, then the reduction of the electric bill is not significanted affected.

[sukim764]

I don't necessarily think E implies that personnel costs are a large portion of an electric bill. In fact, I think it implies the opposite: It doesn't matter whether the personnel cost is a large or small portion of an electric bill because it's unrelated to the type of materials that a company would use. In other words, it doesn't matter if the material is super efficient or inefficient, it wouldn't affect the personnel cost, and ultimately that portion of the electric bill. So, it certainly helps to resolve the discrepancy.

[griffin.811]

I disagree with the above, I think Mary was right on, and I think E only helps resolve the issue if personnel/distribution costs are a large percentage of the residential bill.

If P/D costs are only 1% of the bill, and raw materials (rm) are 99% of the bill, then p/d costs not changing doesn't explain why the bills didn't decline more than 25%, if the rm fell by more than that.

If we flip that and make rm 1% of total costs, and p/d 99%, then E definitely helps resolve the issue. If rm are only 1% of the total bill, it wouldn't matter if the electric co. started getting them free! If the 99% piece doesnt change, that electric bill will remain the same (relatively of course).