While embedding an insert into a table variable in a transaction is valid and would function, the way it is in the question led me to check it, along with the two correct choices.

While I knew it would not fail if tested, it was a pointless option because it included extraneous code for inserting records into a table variable. If the question had inserts, updates or deletes into a temp or permanent table as part of the answer, I probably would not have checked it.

But, the end result is the statement would execute cleanly, so I will take my lumps and move on.