Step 1: Define Efficiency Formula  
The efficiency of a Carnot engine is given by:  
\[
\eta = 1 - \frac{T_2}{T_1}
\]
where:  
\( T_1 \) = Temperature of the heat source  
\( T_2 \) = Temperature of the heat sink  
Step 2: Define Given Conditions  
Initially, the efficiency is given as 25%, i.e.,  
\[
\frac{T_2}{T_1} = 1 - 0.25 = 0.75
\]
which gives:  
\[
T_2 = 0.75 T_1
\]
After increasing \( T_1 \) by 100 K, the new efficiency is 40%, i.e.,  
\[
\frac{T_2}{T_1 + 100} = 1 - 0.40 = 0.60
\]
which gives:  
\[
T_2 = 0.60 (T_1 + 100)
\]
Step 3: Solve for \( T_2 \)  
Equating both expressions for \( T_2 \):  
\[
0.75 T_1 = 0.60 (T_1 + 100)
\]
Expanding and solving:  
\[
0.75 T_1 = 0.60 T_1 + 60
\]
\[
0.75 T_1 - 0.60 T_1 = 60
\]
\[
0.15 T_1 = 60
\]
\[
T_1 = \frac{60}{0.15} = 400 \, K
\]
Now, substituting \( T_1 = 400 K \) into \( T_2 = 0.75 T_1 \):  
\[
T_2 = 0.75 \times 400 = 300 \, K
\]
Thus, the correct answer is \( 300 K \).