Answer: C) At a local barbecue restaurant, they provide each guest with a wet napkin.
A pronoun is the part of speech that replaces a noun. A vague pronoun reference occurs when the antecedent (the noun that the pronoun refers to) is not clear. It is a mistake that can make a narrative confusing or difficult to follow.
In this case, it is not clear who "they" are. It could be the managers, the owners, the servers, etc.
