The sentences are grammatically correct if the verbs and the subject agree with each other. All the members of the faculty were divided on the issue. Thus, option B is correct.
Were is a verb or a noun that is used in the sentences with singular or plural past second person. It is also used in the third person plural past.
The sentence has a plural subject and uses a second person unlike the first person so the word that fits more appropriately is were.
Therefore, the correct blank is 'were.'
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