We reduce the max length of the column from 400 to 200.
Incorrect:
Not A: Sparse column is useful when there are many null columns.
The SQL Server Database Engine uses the SPARSE keyword in a column definition to optimize the storage of values in that column. Therefore, when the column value is NULL for any row in the table, the values require no storage.
Not B, Not C: SQL Server 2005 got around the limitation of 8KB storage size and provided a workaround with varchar(max). It is a non-Unicode large variable- length character data type and can store a maximum of 2^31-1 bytes (2 GB) of non-Unicode characters.
Reference:
https://www.sqlshack.com/sql-varchar-data-type-deep-dive/
https://36chambers.wordpress.com/2020/06/18/nvarchar-everywhere-a-thought-experiment/