Here we have a principle question in which we are trying to find a principle that conforms to the situation described. This question is not about an argument. We are given the following information:
1. Once a child has a developed imagination, imaginary creatures could torment the child.
2. Meanwhile, this imagination also is used to make these creatures harmless, for example by imagining a toy as a defense mechanism against these creatures.
Here is my thought process in real time:
(A) So some capacities only give rise to problems? Well we know that this "capacity" referred to is most likely talking about the imagination. However, we know from the stimulus that imagination - while definitely giving rise to problems - also gives rise to solutions. Thus, the "capacity" described in the answer choice is either not about imagination or is contradictory to the stimulus. Either way, it doesn't give us a principle. Eliminate.
(B) This looks good! I am going to keep this.
(C) This talks about distinguishing between "real" and "imaginary." Well the stimulus only talks about what is "imaginary" and never brings up anything "real." I might have kept this one if it wasn't for (B) because I think it is interesting enough. However, in comparison to the stimulus, I just think this one is off the mark. Eliminate.
(D) "Most effective" way? We don't care about what is most effective at all. All we are given is information about a way that children address fears - imagining their tools as a tool for self-defense. Eliminate.
(E) This one might look good if you skimmed over it. However, we are not talking about the parents here, those that are doing the child-rearing! We are talking about the children only! Eliminate.