Industrial adviser: If two new processes under consideration are not substantially different in cost, then the less ...

Naz on September 25, 2014

Let's break down the principle.

We know that if two new processes under consideration are not substantially different in cost, then the one that is less environmentally damaging should be chosen.

Further, we know that if a company already employs an environmentally damaging process and retooling for a less damaging process would involve substantial cost, then that company should retool only if retooling is either legally required or likely to bring long-term savings SUBSTANTIALLY greater than the cost.

You're mistaken when you say that answer choice (E) conforms to the second part of the principle. The issue with answer choice (E) is in the second sentence: "Changing processes would be costly, but the cost would be almost entirely recovered in long-term savings."

The principle says that if a company already employs an environmentally damaging process and retooling for a less damaging process would involve substantial cost, then it should retool only if retooling is likely to bring long-term savings SUBSTANTIALLY greater than the cost.

Answer choice (E) states that the cost would be almost entirely recovered in long-term savings. But, the principle requires that switching over would bring long-term savings SUBSTANTIALLY greater than the cost.

So (E) does not satisfy the principle since it states that in the long-term, the savings will only allow them to come out about even; whereas the principle requires that in the long-term the savings greatly outweigh the cost.

That is why answer choice (C) is the correct answer.

Hope that clears things up! Please let us know if you have any other questions.