The correct answer is A ( maximum 150 DML statements ).
The governor limit checks first so the AllOrNone option is invalid => answer D is wrong
https://developer.salesforce.com/forums/?id=9062I000000ITHoQAO

i think ans is D. The transaction will succeed and the first ten thousand records will be committed to the database..
The query brings 20 000 records which is within limit of 50 000. the second For loop process each records and updates the list if conditions matches. At the end of the second for loop a database update is done via database.update method option false so it will allow a max of 10 000 records to be updated. Any records after the 10 000 will fail and will be recorded in database.saveResult.

It's D. Outer for loop works in chunks of 200 records per iteration. It's an Apex feature. Check the documentation.