Official Solution:

The island of Tasmania, in which many unique species of marsupials evolved, has a reputation as a rugged, undeveloped territory.

A. The island of Tasmania, in which many unique species of marsupials evolved, has a reputation as a rugged, undeveloped territory.
B. The island of Tasmania, having a reputation as a rugged, undeveloped territory, is one where many unique species of marsupials evolved.
C. The island of Tasmania, where many unique species of marsupials evolved, have a reputation as a rugged, undeveloped territory.
D. The island of Tasmania, where many unique species of marsupials evolved, has a reputation as a rugged, undeveloped territory.
E. The island of Tasmania, a territory with a rugged, undeveloped reputation, is where many unique species of marsupials evolved.


(A) The phrase 'in which' is illogical when referring to 'The island'; it would be correct to use on which or where

(B) The pronoun 'one' has an unclear antecedent; it could refer to The island of Tasmania or a territory

(C) 'The island…have a reputation' does not agree

(D) Correct. The verb 'has' agrees with the subject 'The island of Tasmania'; the sentence is concise and logical

(E) This sentence illogically implies that the island’s reputation is rugged and undeveloped


Answer: D
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The official explanation discusses each of the options individually. If you have query about about any specific explanation, please highlight it so that we may discuss the same in details.

The preposition "in" is wrong.
I live in an island..... wrong.
I live on an island..... correct.

For the same reason, option A is wrong.