The correct answer to the question is diffraction.
EXPLANATION:
Before coming into any conclusion, first we have to understand reflection, refraction and diffraction.
Reflection is the property of light in which the light rays will come back to the same medium after being incident on a wall or mirror.
Refraction is the optical phenomenon in which the light rays will bend towards or away from the normal when it will pass from one medium to another medium which have different optical densities.
The diffraction is also another optical phenomenon of light in which the light rays will bend at the edge of the obstacle when its wavelength is comparable to the size of the obstacle.
As per the diagram in the question, the light ray is allowed to pass through a narrow slit. The narrow slit acts as a obstacle. The light rays are bent after passing through the narrow slit.
Hence, the correct interaction of the wave is diffraction.