Polymerase chain reaction

Reference: NCERT Class XII, page 172.

Each cycle of PCR has three steps in a fixed order: denaturation, annealing and extension.
Step A is denaturation: the double-stranded DNA is heated to a high temperature (about $94^\circ C$) so that the two strands separate. It is not annealing, and it does not occur at about $50^\circ C$.
Step B is annealing: two sets of primers bind to the complementary regions of the separated strands at a lower temperature. It is not denaturation.
Step C is extension: the thermostable DNA polymerase (Taq polymerase from $Thermus\ aquaticus$) extends the primers using the nucleotides provided, copying the template.
Hence the correct identification is C – extension in the presence of heat stable DNA polymerase.

PCR uses a thermostable DNA polymerase (Taq polymerase) isolated from the bacterium Thermus aquaticus.
It remains active during the high-temperature denaturation step, so it need not be added again in each cycle.
Ligation is done by DNA ligase, and the enzyme is from a bacterium, not a virus.