In the 1930s, John W. Campbell wrote short stories about an Antarctic research camp that discovers and thaws the ancient body of a crash-landed alien and eventually combined them in a novella
forming the basis of the blockbuster movie “The Thing.”
(A)
forming the basis of the blockbuster movie
The meaning of the sentence is not clear with the word "forming". "Forming the basis" is not appropriate as it was not an ongoing process.
(B)
that were forming the basis of the blockbuster movie
"That were forming" is incorrect since "Novella" is singular, so needs "was" and secondly the use of past continuous tense is incorrect, since it was not an ongoing action.
(C)
to form the basis of the blockbuster movie
"To form" is incorrect since the "Novella" was not compiled with the intention of making a movie. "To form" signals intention, which is not correct.
(D)
which had formed the basis of the blockbuster movie
"That" is preferable here in place of "which", but more importantly, there is no need to use Past Perfect "had" here, since this action happened after the "novella" was compiled.
(E)
that formed the basis of the blockbuster movie
E seems the correct answer since "that" clause in simple past conveys the correct meaning.
IMO the answer is E because of the reasoning mentioned above.