Answer: C) The components of white light are refracted at different angles due to their various wavelengths.
Explanation: As oil is denser than water, it floats over water. Both upper and lower layers of oil can reflect light and the two reflected rays undergo interference.
As the thickness of oil decreases on moving from center to periphery, the color of the reflected light differs. Moreover the angle of incidence of light also affects the color of light. Thus we see different colors corresponding to different wavelengths.