The correct option is D There is a regulatory gene that is downstream from the structural genes that can inhibit transcription.
An operon consists of structural genes and an operator gene. The gene that codes for any RNA / protein product which does not serve as regulatory protein is known as structural genes. The operator is a DNA sequence present between the promoter region and the first coding gene. This operator region serves as a repressor protein binding site. The promoter is a DNA segment that serves to initiate transcription of a particular gene and binding site for RNA polymerase. Regulator gene (located upstream of structural genes) regulates the expression of structural genes by its protein products (repressor) that are mostly transcription factors. These transcription factors bind to the operator region which is located just upstream the binding site of the RNA polymerase and hence prevent the binding and transcription. The inducer is a molecule that binds to the repressor and causes conformational changes in repressor which in turn can no longer bind to the operator. Thus inducer induces the expression of the structural gene. Thus, the correct answer is option C.