The cost of generation of power is the lowest when diversity factor is

The correct answer is option 1): (the highest)

Concept:

Diversity factor:

• The ratio of the sum of individual maximum demands to the maximum demand on the power station is known as a diversity factor.
• A power station supplies load to various types of consumers whose maximum demands generally do not occur at the same time\(Diversity\;factor (DF) = \frac{{Sum\;of\;individual\;maximum\;demands}}{{Maximum\;demand\;on\;power\;station}}\)
• The greater the diversity factor, the lesser the cost of the generation of power. Because a greater diversity factor means lesser maximum demand. Now, lower maximum demand means a lower capacity of the plant which reduces the cost of the plant.
• Hence The cost of generation of power is the lowest when the diversity factor is the highest