D. I and II only.
Let's see why.
We already know that gravity pulls down on everything, including the wooden block in the bucket of water, So II must be correct. The water pushes up on the block beacause the block is lighter than the water, so the water "wants to stay closer than the earth than the block." This is why boats float. They are hollow, so they wiegh less than the water that they displace, therfore they float.