More natural would be "they used to have a dog." I don't know if this would be accepted or not.
That would be better. 'In the past they had a dog' is very awkward English.
Agreed. "They had a dog in the past" is slightly less awkward, but it's not currently accepted.
this is appropriate english
Its wrong hebrew, להמ כלב is not היה להמ כלב, they didnt include היה
So they're getting both the Hebrew and the English wrong. 'They used to have a dog' is obviously a better translation than the one Duolingo offers, but it's marked wrong.
להם כלב is in the present but mostly you would say יש להם כלב and היה להם כלב is in the past tense
Should it not be pronounced "ba avaar" and not "be avar"