Equipment!!

[gmatissimple]

Lacking information about energy use, people tend to overestimate the amount of energy used by equipment. such as lights, that are visible and must be turned on and off and underestimate that used by unobtrusive equipment, such as water heaters.
(A) equipment, such as lights, that are visible and must be turned on and off and underestimate that
(B) equipment, such as lights, that are visible and must be turned on and off and underestimate it when
(C) equipment, such as lights, that is visible and must be turned on and off and underestimate it when
(D) visible equipment, such as lights, that must be turned on and off and underestimate that
(E) visible equipment, such as lights, that must be turned on and off and underestimate it when

My thoughts:

• “Equipment, such as lights, that” needs a singular verb “IS”, not plural verb “ARE”
• “Visible equipment” is preferable rather than “equipment that is visible”.
• The amount... used by is parallel with that used by, in which that is the pronoun substitute for amount.
• In B, C, and E, when used by does not parallel amount... used by and nonsensically suggests that the people are used by the equipment. ---I am in confusion with this explanation.

Is it "people underestimate it when used by equipment"?

[arindambanerji]

Here you go

equipment, such as lights, that are visible and must be turned on and off and underestimate it when...

The modifier, "that are visible and must be turned on and off and underestimate it when...", is modifying lights. And light is the subject in theis modifier. The pronoun "it" in the modifier is referring to people. Hence it means that the lights are underestimating people.

Modifier - Lights (equipments)

Lights that are visible and (Lights)must be turned on and off and (Lights)underestimate it (people) when....

[Fiver]

Here are my thoughts:
1] Equipment, like information, can be used as a singular or a plural noun.
2] In this context 'equipment' must be plural as the examples (lights & heaters) are plural.
3] In all options, since 'such as lights' is set-off in a pair of commas, 'that' following the modifier does not refer to 'lights' but rather to the plural noun: 'equipment'.
4] Parallelism demands the following: 'amount (noun)+ of (preposition)+energy (object of preposition) = 'that' and not 'when'

[atishree]

IMO E
people tend to overestimate the amount of energy used by visible equipment, such as lights,[ that must be turned on and off and ]underestimate it(amount of energy (singular)) when

I hope splitting the modifier makes the meaning clear here

[harishr1981]

IMO D.

OA por favor, El Señor...