C. White Fang is beginning to develop better instincts about the humans.
Explanation:
Grey Beaver, a man from the village, was the owner of her White Fang's mother, Kiche. After the man took his mother and him into his care, White Fang starts to like the feeling of being petted and loved by the man. When he noticed the man trying to do something with sticks and dry moss, he interpreted it not hostile.
Instead he soon discovered that the man was trying to light a fire which was very new to White Fang. When he burnt his tongue and nose, the man started laughing. At first he didn't understand why the man was laughing at his misery but he slowly started to have better instincts about human. He got to understand that man-animals could make and understand many things about life.
Base on the story of the swimmer by F. Scott Fitzgerald, he reveal the setting of the passage by mentioning water and sand and the best answer among the choices is in the last choice. I hope you are satisfied with my answer and feel free to ask for more