Choice "B" is correct. The intercept value is the point at which the behavior of the independent variable (production) stated in terms of the dependent variable (cost) intercepts the y axis as follows:
Choice "c" is incorrect. The "x" axis, or independent variable, measures production in units, not dollars (per above).
Choice "d" is incorrect. The "y" intercept is not the residual error of the regression.
Choice "a" is incorrect. The "y" intercept is not the average cost. It is most likely the amount of fixed maintenance costs.
