Answer:
The boat
Step-by-step explanation:
A direct object always follows an action verb. The first step to determing the direct object is to identify the subject and then the action verb. Then you need to ask yourself "whom" or "what" is receiving the action.
The subject is "the townspeople" and the action verb is "launched." What is being launched? The boat.
Keep in mind that there can be sentences with more than one direct object and some sentences that don't have a direct object.