There are four sentences S1, S2, S3, S4 where the underlined phrase is used either correctly or incorrectly. Choose the option which lists the sentences, where the underlined phrase is used correctly.
S1. Good Lord, I’m not rich! on the contrary, I’m constantly in debt.
S2. She’s very intelligent, but on the contrary she’s apt to be impatient.
S3. Yes, it’s a very cosmopolitan city. On the contrary, it’s very expensive.
S4. I don’t think he’ll pass the exam. On the contrary, I think he’ll almost certainly fail.

'On the contrary' is used in a sentence to put forth an opposite argument of fact.

Statement 1: Since the statement presents opposite scenarios, 'on the contrary' is used appropriately.

Statement 2: Here, the usage of 'but' has made the usage of 'on the contrary' redundant. Thus, this is a wrong statement.

Statement 3: As there is no contrast in the two lines, 'on the contrary' should not be used here. Thus, this is a wrong statement.

Statement 4: Since the statement presents opposite scenarios, 'on the contrary' is used in an appropriate manner.

Thus, the correct option is C.