Be careful! "वह" always uses "है" and "वे" always uses "हैं" (with anuswaar). This is why you were marked wrong.
There's no real difference in the pronunciation. But when you're writing, it matters whether you use "है" or "हैं".
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Listen brother, we ,they are is a plural verb and he,she,it ,i ,singular word,but with singular verb we add Sat the end of verb.