The correct answer is C) proportional action. A single element boiler feed water regulating system aboard ship utilizes proportional action, which adjusts the water flow in proportion to the deviation from the desired water level setpoint. This allows for a continuous adjustment of the water flow to maintain the target water level without the abrupt changes associated with two-position or on/off control. The other options are incorrect because: A) two-position differential gap action would cause the water flow to switch between fully open and fully closed, B) proportional plus reset action adds an additional control component to adjust for sustained errors, and D) proportional plus reset plus rate action is a more complex control scheme not typically used in a single element boiler feed water regulating system.