Sentence Correction

Although a surge in retail sales have raised hopes that there is a recovery finally underway,
many economists say that without a large amount of spending the recovery might not last.

A)have raised hopes that there is a recovery finally
B)raised hopes for there being a recovery finally
C)had raised hopes for a recovery finally being
D)has raised hopes that a recovery is finally
E)raised hopes for a recovery finally

Though I could pick the correct answer quite easily because of "Tense" and "Meaning" issues. I still have couple of questions regarding explanations provided by OG.
1. Which on is better or correct and why? - "raised hopes for X finally" or "raised hopes that X is finally"
Would D still be correct if it was - "has raised hopes for a recovery finally underway"?

2. In option A, why is "there is" incorrect?

I would request experts to through some light.

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