The bottle is _______ bottle caps long.

The correct option is C $7$
Say:
On our screen, we have a bottle which is to be measured with the help of bottle caps.

Steps:
We will begin from the bottle cap that is at one corner or the beginning of the bottle, i.e., the left-hand side.
We will count the number of caps till the bottle ends.
That makes up $7$ caps.
Hence, the bottle is $7$ bottle caps long, i.e., Option A.

Probing Q: I see $8$ caps on the screen to measure the bottle, then why is the answer $7$? Let us correct it to 8. Shall we?

Ans: No. We only count till the end of the object that we are measuring. The bottle ends at the $7^{th}$ cap so we will count till then. Any cap after that will not be considered.