Answer :
Choice C is correct because the words describe the setting while having a certain connotation that makes the reader feel a certain way.
The correct option is C. The ruins of the once-thriving city feel dangerous and forbidding.
The setting of a piece of text is the time and place the narration takes place. In this case, the word "ruins" and "once-thriving city", indicate that the place in which the narration takes place is a city which had been popular and successful but now is either forgotten or destroyed.
The mood in literature refers to the feeling that evokes in readers and the atmosphere it creates for the story. In Option C, the words "dangerous" and "forbidding" clearly set a negative or pessimistic mood as the city is now risky.