After more than four decades of research and development, a new type of jet engine is being tested that could eventually propel aircraft anywhere in the world within two hours or help boost cargoes into space at significantly lower costs than current methods permit.

A. tested that could eventually propel aircraft anywhere in the world within two hours or help
B. tested that could eventually have the capability of propelling aircraft anywhere in the world within two hours or to help
C. tested, eventually able to propel aircraft anywhere in the world within two hours, or helping
D. tested, and it eventually could propel aircraft anywhere in the world within two hours or helping
E. tested, and it could eventually have the capability to propel aircraft anywhere in the world within two hours or help


OA is A. WHY?? tested following that?

you've just learned a new thing - the gmat sometimes places 'that' modifiers after the verb. i'm with you on thinking that this is rather awkward, BUT imagine the way the sentence would look if you placed the 'that'-modifier in its usual place:
a new type of jet engine that could eventually propel aircraft anywhere in the world within two hours or help boost cargoes into space at significantly lower costs than current methods permit is being tested.
i dare you to understand what that sentence means without reading it 3-4 times - there is approximately six miles of text between 'a new type of jet engine' and 'is being tested'. so apparently, the gmat follows the rule that a modifier that doesn't contain any punctuation can't be allowed to place too much distance between a subject and its verb. notice the distinction: if you have a 'which' modifier, which is preceded and followed by commas, then that modifier can be inserted between the subject and verb even if it's miles long (because the commas elucidate the structure, thereby preventing the obfuscation shown above).

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here are some major problems with the other answers (not meant to be an exhaustive list)
(b) bad parallelism: have the capability vs. to help
(c) bad parallelism: able to propel vs. helping; also, the hypothetical ('could') has been lost completely
(d) bad parallelism again; also, 'and' is an inappropriate conjunction (makes it seem as though two unrelated, or distantly related, things are being discussed)
(e) ridiculously wordy; same problem with 'it' as in (d)