Simplify sentences.

One goal is...
(A) to develop a chip that can do x & y, a development that may lead to z

(B) to develop a chip with the capability of doing x & y, which may lead to z

(C) the development of a chip that has the capability of doing x & y, a development maybe leading to z

(D) developing a chip that can do x & y, which may lead to z

(E) developing a chip with the ability to do x and y, with this development maybe leading to z

Note that the end of the sentence is a modifier. What does it target? what may lead to faster semiconductors? There is no single noun, so we cannot use a noun modifier. When the GMAT wants to refer to something other than the near noun or noun phrase, it uses an -ing or a noun to begin the modifier. In this case, "a development..." is the right way to start the modifier. We can eliminate B, D and E.

C is very inefficient when compared to A. "a chip that can transmit" is more concise than "a chip with the capability of transmitting".

Furthermore, C uses the awkward construct "a development maybe leading to ..." whereas A states "a development that may lead to...". A is the best answer.

Hope that helps,
-Patrick

(A) to develop a silicon chip that can transmit and receive light signals directly, a development that may one day lead (my answer)
(B) to develop a silicon chip with the capability of transmitting and receiving light signals directly, which may one day lead (wrong placement of which)
(C) the development of a silicon chip that has the capability of transmitting and receiving light signals directly, a development maybe one day leading
(D) developing a silicon chip that can transmit and receive light signals directly, which may one day lead (wrong placement of which)
(E) developing a silicon chip with the ability to transmit and receive light signals directly, with this development maybe one day leading