Final answer:
The car took 1 minute and 6 seconds, or 66 seconds, to reach the observer, hence the correct answer is 66 seconds.
Step-by-step explanation:
The question pertains to the concept of elapsed time, a basic concept in the study of Physics, specifically in kinematics. When the students observed the car and started the stopwatch, they measured the time. If the stopwatch was showing 01:06 when the car reached the observer, this means that the car took 1 minute and 6 seconds to reach the observer from the point when the stopwatch was started. Therefore, the correct answer is B. 66 seconds.