To solve this problem you must apply the proccedure shown below:
 1. You have the following information given in the problem above:
 - x²+y²=74
 xy=35
 2. Therefore, you have that (x-y)² is:
 =(x-y)²
 =x²-2xy+y²
 =(x²+y²)-2xy
 3. When you substitute the values given in the problem, you obtain:
 =74-2(35)
 =74-70
 =4
 4. Therefore, as you can see, the correct answer is: 4