There is no way for us to answer this question definitively; the authors of the question are the only ones capable of doing so. But the following possibilities seem plausible to me:
There is a typo in Answer C and "not" should be removed. (Very likely.)
There is a typo in Answer C and "male/female binary gender" should be "third gender". (Somewhat likely. "Binary gender" is only used in the passage's first sentence.)
There is a typo in the explanation. (Unlikely.)
The usage of "male/female binary" in Answer C is equivalent to the usage of "third" in the explanation. (Very unlikely; binary gender more commonly refers to the concept that there are only two genders and is the same terminology used in the question.)
Answer C is actually asking whether the concept of binary gender is limited to Western culture. (Very unlikely. If this is the implication then both the answer and the explanation are very poorly worded.)
Answer C is making a distinction between the passage's usage of Western culture and the answer's usage of Western contemporaryculture. (Very unlikely. This would be a ridiculous semantic trick and is not mentioned in the explanation.)
If I were to answer the question I would have only answered A. You should contact the authors and confirm the made a mistake or get a more thorough explanation for why Answer C is correct.
