The correct option is
D Sexually and asexually
Hydra reproduces sexually by fission and by the process of budding an asexual reproduction process. In budding, a single
develops as a simple evagination of the body wall, it matures to grow out into an entire organism. Sexual reproduction occurs in unfavourable conditions and fertilization of ovum and sperm take place.So, the correct answer is 'Sexually and asexually'.