Final answer:
When a modify bit of a page is set during replacement, it indicates that the page is dirty because it has been modified since it was brought into memory.
Step-by-step explanation:
When a page is selected for replacement and its modify bit is set, this indicates that the page has been modified since it was read in from disk. Therefore, the correct answer is (b) the page has been modified since it was read in from the disk, which is also known as the page being dirty. When a page is dirty, it means that its contents have been altered and need to be written back to the disk before the page can be replaced. Alternatively, a clean page has not been modified and thus can be replaced without writing its contents back to the disk.