Question

Which corrects the incorrect pronoun or contraction in the sentence? Their watching the dog to see if its paw is hurt.
a. it is
b. they're
c. there
d. it's

Answer 1

B. They're

The corrected sentence looks like this: 
They're watching the dog to see if its paw is hurt.

They're is a contraction of They are.
They are watching the dog to see if its paw is hurt.

Their is the possessive adjective of the pronoun them.
They're watching their dog to see if its paw is hurt.