Botulism pretty much is the disease caused by the toxins produced by that particular bacterium. Its toxins are very potent and do some interesting things to the body when introduced. In fact, it goes through the blood until it hits nerves, where it prevents those nerves from sending certain messages to tissues (it blocks the release of acetylcholine).
Without these messages, tissues respond in all sorts of negative ways. For the person who was poisoned by the toxin, these ways include some very bad things like descending paralysis and respiratory muscle failure.
So, that's what the toxin does. Most of the time, when someone gets this sort of food poisoning, it's the result of poorly stored or not-very-well cooked food (ever see a can of food that's bulging out the top and bottom? don't eat what's inside). However, what's happened in those cases is that the endospores have already germinated and produced the toxin. So, it's really just the toxin causing problems.
However, two other forms of botulism depend on direct placement of endospores in the body, which then germinate and produce toxins. The first is wound botulism, where a wound is created and the endospore settles in, germinates, and produces toxin (big deal with heroin...don't do heroin). The second is infant botulism, where you feed the infant honey containing endospore, which then germinates and produces toxin in the baby's intestines (apparently honey is the culprit in only 20% of all cases, according to the link below).
So, which letter is correct, then? Well, clearly, if the endospores have been killed (like through cooking), then they can't do anything. The toxin, itself, is also heat-labile (it is rendered ineffective when heated). So clearly, A is incorrect. What about the rest? Certainly, the toxin is the chemical producing the effects, so B must be correct. HOWEVER, only germinated endospores can produce the exotoxin, so C must be correct, as well! Reproduction can only be done by germinated endospores, and it would certainly increase the effect, but in terms of toxin production, a bacterium need not reproduce to produce toxin, so I'd be less-inclined to select D.
B sounds the closest, but you can make a pretty darn good case for C, too.
Hope that helps!