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One that they believe - leads to redundancy, since –one- or simply -that- can serve the purpose to denote the new species. Therefore, choices A and B are dropped.
In C and D, we have a different pronoun redundancy with - it and that - The -that and it - refer to the same as one.
Chocie E avoids the pronoun redundancy altogether; therefore, it survives. Interestingly, the following is a GPREP question, whose answer is also E.
Astronomers at the Palomar Observatory have discovered a distant supernova explosion, one that they believe is a type previously unknown to science. (A) that they believe is (B) that they believe it to be (C) they believe that it is of (D) they believe that is (E) they believe to be of