Per-Unit Impedance Conversion
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Per-unit impedance transforms as Zpu,new=Zpu,old(Snew/Sold)(Vold/Vnew)². If both base MVA and base kV are halved, the factor is (1/2)×(2)²=2, so the new per-unit impedance is 0.25×2=0.5. Hence option C.

Base-kV change is squared; base-MVA change is linear.
Do not halve per-unit impedance just because both bases are halved.
Base-kV change is squared; base-MVA change is linear.