Step 1: Concept
The efficiency ($\eta$) of an ideal Carnot heat engine depends purely on the absolute temperatures of its thermal source ($T_1$) and sink ($T_2$), given by the formula $\eta = 1 - \frac{T_2}{T_1}$.
Step 2: Meaning
Initially, the efficiency is $\eta_1 = 0.50$ and the initial source temperature is $T_1 = 400 \text{ K}$. We can utilize these parameters to first calculate the fixed sink temperature $T_2$.
Step 3: Analysis
From the initial state: $0.50 = 1 - \frac{T_2}{400} \implies \frac{T_2}{400} = 0.50 \implies T_2 = 200 \text{ K}$. For the modified state, we want a target efficiency $\eta_2 = 0.70$ keeping $T_2 = 200 \text{ K}$ unchanged. Let $T_1'$ be the new source temperature. Using the efficiency equation again: $0.70 = 1 - \frac{200}{T_1'} \implies \frac{200}{T_1'} = 0.30 \implies T_1' = \frac{200}{0.30} = \frac{2000}{3} \approx 666.67 \text{ K}$.
Step 4: Conclusion
Rounding to the nearest whole integer yields a source temperature of 667 K.
Final Answer: (D)