The correct option is C Paramecium - encystation
The phenomenon of encystation is seen in Amoeba under unfavourable conditions. The Amoeba withdraws its pseudopodia and forms a three-layered hard covering or cyst around itself.
Amoeba and Paramecium reproduce by binary fission. In binary fission a parent cell divides into two daughter cells of approximately equal size and each rapidly grows into an adult.
Yeast and Hydra reproduce by the process of budding. In budding an outgrowth called bud develops on the parent body which grows and matures. Eventually it separates from the parent body after becoming an adult.
Fragementation is the method of asexual reproduction wherein the organism breaks its body into fragements and each fragment develops into a new organism. This type of asexual reproduction is seen in Spirogyra, flatworms, Hydra .