Option B is correct because a static nested class is not tied to an instance of the enclosing class, and thus can't access the nonstatic members of the class (just as a static method can't access nonstatic members of a class).
Option A is incorrect because static nested classes do not need (and can't use) a reference to an instance of the enclosing class.
Option C is incorrect because static nested classes can declare and define nonstatic members.
Option D is wrong because it just is. There's no rule that says an inner or nested class has to extend anything.
