Hydroponic spinach

vk_vinayak wrote:Near Chicago a newly built hydroponic spinach “factory,” a completely controlled environment for growing spinach, produces on 1 acre of floor space what it takes 100 acres of fields to produce. Expenses, especially for electricity, are high, however, and the spinach produced costs about four times as much as washed California field spinach, the spinach commonly sold throughout the United States. So our argument goes as follows: They can make spinach using less land but it cots 4x as much to produce (due to production costs). Question: How can they sell it? Answer will be something that makes the operation profitable. For example, it is better, healthier, or has cheaper transportation costs to the east or something

Which of the following, if true, best supports the projection that the spinach-growing facility near Chicago will be profitable?

(A) Once the operators of the facility are experienced, they will be able to cut operating expenses by about 25 percent. This is incorrect. Although it cuts cost by 24% this will NOT offset the 4x operation expense. It is still cheaper in California.
(B) There is virtually no scope for any further reduction in the cost per pound for California field spinach. This is incorrect. We don't care about Californian spinach. Even if California can't reduce its clots anymore, it is still 4x cheaper than Chicagoan.
(C) Unlike washed field spinach, the hydropoincally grown spinach is untainted by any pesticides or herbicides and thus will sell at exceptionally high prices to such customers as health food restaurants. This is the correct answer. It says that, despite such high costs, there is a market for Chicagoan spinach. Thus, the operation is economically viable.
(D) Since spinach is a crop that ships relatively well, the market for the hydroponically grown spinach is no more limited to the Chicago area than the market for California field spinach is to California. This is incorrect because it does not explain how/why Chicagoan spinach will be economically viable.
(E) A second hydroponic facility is being built in Canada, taking advantage of inexpensive electricity and high vegetable prices. This is incorrect because the questions specifically asks for the "factory" in Chicago. So... this is irrelevant.