Although some had accused smith, the firm’s network manager, of negligence when the crucial data went missing, the ceo defused a situation that was quite tense with her public statement that the debacle was not smith’s fault.

a. a situation that was quite tense with her public statement that the debacle was not smith’s fault
b. a situation that was quite tense, by publicly stating that the debacle was not smith’s fault
c. a situation, which was quite tense, by stating publicly that smith was not responsible for the debacle
d. a quite tense situation with a public statement about the debacle not being smith’s fault
e. a quite tense situation by publicly stating the debacle not to have been smith’s fault

B

Explanation: B. a situation that was quite tense, by publicly stating that the debacle was not Smith’s fault

This is CORRECT. It's clear that the CEO made a public statement herself with the phrase "by publicly stating." It gives credit where it's due, and it's absolutely clear what the writer intended to say.

We can eliminate options D & E because they don't use the proper construction when describing the situation.

C. a situation, which was quite tense, by stating publicly that Smith was not responsible for the debacle

This is INCORRECT because the addition of "which" turns this phrase into a non-essential modifier. This sentence tells us that the phrase "which was quite tense" isn't important information to the overall meaning of the sentence. In this sentence, it IS important to know that the situation the CEO diffused was tense - otherwise why would she bother dealing with it?

A. a situation that was quite tense with her public statement that the debacle was not Smith’s fault

This is INCORRECT because the phrase "with her public statement" is problematic. By not giving clear credit to the CEO for making the statement, readers might think that the CEO diffused the situation with a public statement made by someone else, or by not actually making the statement herself. This isn't a strong enough way to say what they mean, so it's not the best choice.

answer; (b) insider trading;