The correct option is B Exchange of respiratory gases.
∙ Lungs are made up of many smaller compartments known as alveoli which provide large surface area for the exchange of gases.
∙ The thin walls of the alveoli contain an extensive network of capillaries.
∙ Haemoglobin present in the RBCs of the blood absorbs the oxygen from air within alveoli.
∙ Simultaneously, CO2 and water vapour move out from blood into the alveoli.
∙ Thus, oxygen is taken into the blood, CO2 and water vapour are removed from the blood and given out by exhalation.