She speaks as if she __________ everything.

The correct answer is "knew". This sentence uses the phrase "as if," which introduces a clause describing an unreal or hypothetical comparison. When "as if" (or "as though") is followed by a clause that expresses something contrary to fact, improbable, or merely a supposition, the subjunctive mood is typically employed. In this specific context, "she speaks as if she knew everything" implies that she does not, in fact, know everything, but her manner of speaking gives that impression. To convey this hypothetical or unreal condition in the present, the past simple tense ("knew") is used in the "as if" clause, even though the main verb "speaks" is in the present tense. This grammatical construction is crucial for expressing an unreal condition or an imagined scenario that contrasts with reality. The use of "knew" correctly signals that the statement following "as if" is a supposition or an imagined state, rather than a factual assertion. This makes "knew" the appropriate choice to maintain grammatical accuracy and convey the intended meaning of an unreal comparison.