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According to John Dewey's progressive philosophy of education, a school should be designed as a laboratory, in which children may develop their potential through the integration of experience and learning, and also as an embryonic community that exposes them to the principles of democracy, rather than just teaching abstract knowledge.
This answer choice is grammatically incorrect. The construction A rather than B requires that A and B belong to the same part of speech. In this case, A (as a laboratory... and as an embryonic community) is comprised of two parallel nouns whereas B (teaching) is a non-conjugated verb.[[snippet]]
While this answer choice corrects the Parallelism mistake in the original question, by moving the clause beginning with rather than to the beginning of the underlined section, it is grammatically incorrect.
Verb+ing (experiencing) can be used as a noun replacement only when there's no actual noun. Since there is a real noun - experience - it should be used instead.
This answer choice corrects the Parallelism mistake in the original question, by changing the clause just teaching abstract knowledge to a noun: a mere purveyor of abstract knowledge.[[snippet]]
The corrected sentence results in a nested parallel structure: a school should be designed as A rather than B.
A [=(A' = a laboratory and B'= an embryonic community)] rather than B [=a mere purveyor of knowledge].
While this answer choice corrects the Parallelism mistake in the original question by rearranging the sentence's structure, and moving rather than just teaching, etc. into the middle of the sentence, after the word learning, this answer choice is illogical and changes the meaning of the original sentence.
In the original sentence, school was the subject of the verb teaching, whereas in the corrected sentence children is the subject of teaching.
While this answer choice corrects the Parallelism mistake in the original question, by creating two clauses separated by a semicolon, it introduces another grammatical mistake and is stylistically flawed.
Grammatical mistake: The relative pronoun that cannot appear after a comma.
Stylistic Flaw: The creation of a second clause and the use of it to refer to the subject a school in the new clause is wordy and redundant. The three points about Dewey's philosophy concerning schools can be worded more concisely by using parallel structures.