The kinetic energy of the system after the collossion is less than the kinetic energy of the system before the collision. This is because the heat generated from the collision which is a direct consequence of the friction between both vehicles and possibly the road too. This heat energy due to friction is not a conservative form of energy and cannot be regained in another form. So after the collision this energy is lost, thereby reducing the total kinetic energy the system had before the collision.
Collisions as these are inelastic collisions. For inelastic collisions, the total momentum is conserved before and after the collision. The kinetic energy on the other hand is not conserved. This is because in most cases some of the energy is lost due friction in the form of heat.
Elastic collisions on the other hand generally have the total momentum and kinetic energy conserved before and after collision.
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B. The kinetic energy of the system is partially used for deforming the car.
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