The principal revealed that students' standardized test scores increased even more this year than she had expected it to and their grades will improve next semester as well.
A. had expected it to and their grades will improve
-- will improve is incorrect. We need "would" as the complete act is in past - "principal revealed"
B. had expected and that their grades would improve
-- correct choice
C. expected it would and that they will improve their grades
-- we need "had expected" - because act to expect happened before the act to reveal.
-- will improve is incorrect
D. expected them to and their grades would improve
-- we need "had expected" - because act to expect happened before the act to reveal.
E. expected and that they will have improved their grades
-- we need "had expected" - because act to expect happened before the act to reveal.
-- will have (future perfect is incorrect). We need "would".