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THE SUBJUNCTIVE MOOD
So this is basically used in two special situations:
- Unlikely or unreal conditions (usually after 'if' or a similar word)
- Proposals, desires, and requests formed with certain verbs and the word that
These two uses correspond to two forms of the subjunctive mood: The Hypothetical Subjunctive and the Command Subjunctive, respectively

The Hypothetical Subjunctive
We use it in a few circumstances to indicate unlikely or unreal conditions. Principally, this form occurs after 'if', 'as if', or 'as though'
Now the basic form of the Hypothetical Subjuctive is equivalent to the Simple Past of every Verb, with one exception. For the verb 'to be' . For the verb 'to be' the form were is always used.
Eg. To overcome my fear of germs, I will think about disease as though it WERE harmless

The Command Subjunctive
The other form of the subjunctive mood is the Command Subjunctive, which is much more important on the GMAT than the Hypotethical Subjunctive
The command subjunctive is used with certain BOSSY VERBS such as require or propose. Bossy Verbs tell people to do things
This form is also known as the Bare Form of the verb: the infinitive without the 'to'.
The subjunctive construction with a Bossy Verb is always as follows: Bossy Verb + THAT + subject + Command Subjunctive
However, there are some common Bossy Verbs, such as WANT, you cannot use the Command Subjunctive with but rather an infinitive (to + the bare form)
- Common Verbs that take ONLY the Command Subjunctive when indicating desire: demand, dictate, insist, mandate, propose, recommend, request, stipulate, suggest

Note: Propose can take an infinitive when there's no second subject (Eg. The attorneys PROPOSED TO MEET the following day)
- Verbs that take ONLY the infinitive: advice, allow, forbid, persuade, want
- Verbs that take EITHER the Command Subjunctive OR the infitinive: ask, beg, intend, order, prefer, urge, require

Also, you should keep in mind that few bossy words, most notably prohibit, take other constructions alltogether (Prohibit FROM)
The Command subjunctive can also be used with nouns derived from Bossy Verbs, such as a demand or a request.
Also the Command subjunctive is possible with 'It is X', in which X is an adjective, such as essential, that conveys urgency. It is X is not commonly tested on the GMAT (Eg. It is essential THAT Gary BE ready before noon)

Other adjectives conveying urgency include: advisable, crucial, desirable, fitting, imperative, important, mandatory, necessary, preferable, urgent and vital.
Note also that you can use an infinitive in these constructions (Eg. It is essential for Gary to be ready before noon)
Avoid the use of the Command Subjunctive 'whether'. This usage is old fashioned (Eg. I like Ice cream, , whether it BE choclolate, vanilla, or any other flavor)

Oh and by the way, a few Bossy Verbs can be used in non-Bossy ways: Her presence SUGGESTS that she IS happy. In this context, suggests means "probably means"; it is not acting Bossy. As always, pay close attention to the meaning!

Hope it helps you out
Make some Kudos rain if you like it. I really need them for my GMAT tests

Take it easy ok?
Cheers
J

P.S. Oh, and BTW will some clarify what's wrong with Choice (B) in the question above? Let me know

Thanks