Answer is A

A.multiple child cases are created for each parent in trigger.new - This cannot be the answer since the For loop only creates a single child case in the For loop.
B.Trigger enters infinite loop and eventually fails - The trigger runs when a new case is created, and creates a case within itself. This recursive behavior would result in an infinite loop with this particular code.
C.Child case is created for each parent case in trigger.new - This is true, but choice B is the better answer since the code would fail.
D.The trigger fails if subject field on parent is blank - This cannot be possible since the parent should be able to be created without a Subject if that field is required.

I believe the answer is A. While D is true, I believe A is the better answer because it tells you what happens as it fails