Final answer:
Testosterone functions inside a target cell by binding with a receptor protein that enters the nucleus and activates expression of specific genes.
Step-by-step explanation:
The mechanism by which testosterone functions inside a target cell is by binding with a receptor protein that enters the nucleus and activates expression of specific genes (option 2). Steroid hormones, like testosterone, can cross the plasma membrane of a target cell and bind to intracellular receptors either in the cytoplasm or in the nucleus. When the hormone binds to its receptor, it forms a hormone-receptor complex that affects gene expression by increasing or decreasing the synthesis of specific proteins.
Regarding the action of kinases, these enzymes facilitate the transfer of phosphate groups onto other molecules. Therefore, kinases play a central role in signaling cascades within cells, including those triggered by non-steroid hormones that activate second messenger pathways leading to a series of phosphorylations, ultimately affecting gene expression or cellular activities.