The answer is (D). Let the base-2 expansion of a generic integer $a$ be
$$\ldots + 2^{8} a_{8} + 2^{7} a_{7} + 2^{6} a_{6} + 2^{5} a_{5} + 2^{4} a_{4} + 2^{3} a_{3} + 2^{2} a_{2} + 2^{1} a_{1} + a_{0}$$
then, if we group the terms three by three starting from the right, collecting a suitable power of 8, we obtain
$$\ldots + 8^{2} (4 a_{8} + 2 a_{7} + a_{6}) + 8 (4 a_{5} + 2 a_{4} + a_{3}) + (4 a_{2} + 2 a_{1} + a_{0}) .$$
Since the terms in parentheses are always between 0 and 7, what we obtained is the expression in base 8 of the number $a$. Observing how the digits are grouped, it is easy to conclude that, denoting by $b_{k}$ the digits of the expansion in base 8 of the number, we have
$$b_{k} = 4 a_{3k+2} + 2 a_{3k+1} + a_{3k} .$$
For the number under examination, operatively, it suffices to group the digits in groups of three starting from the last one on the right, and read (in base 2) the seventh group of digits starting from the left (note that the first group is made up of the single digit 1):
$$1|110|000|100|111|010|101|110|100|001 .$$
The seventh digit is thus $101_{2} = 5$.