<span>Regarding integrity, “discerning what is right and what is wrong . . . captures the idea that integrity requires a degree of moral reflectiveness” (Carter).
The parentheses in this sentence is being used to cite the source of the quotation. It is important to put the parentheses around the author's last name and inside of the period it is associated with. By putting the parentheses inside the period, the sentence includes the citation and clearly shows that the citation belongs to Carter. If (Carter) was outside of the period, it would not be clear whether the citation belongs to the sentence before or after. The other options are wrong when Carter is used as the subject of the sentence.
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It would be quite helpful to cite supporting details if we knew the story.
C. Illustrate
If I am not mistaken!
Hope this helps you!