Refer to figures.
Looking at the options firstly:

• “The use of a low aspect ratio wing”
  • INCORRECT → The opposite is true, a high aspect ratio wing (long and thin, like a glider) is most efficient at reducing induced drag.
• “Increasing the angle of incidence of the wing tips.”
  • INCORRECT → This is the opposite of washout, which is the correct answer.
• “Washout.”
  • CORRECT → As discussed below, this reduces induced drag somewhat, but it is primarily used for avoiding tip-stalls.
• “A mass balance.”
  • INCORRECT → This is a feature that adds weight ahead of the hinge line of a control surface to stop flutter. Induced drag (also called lift induced drag) is the drag force caused by the fact that our lift force is actually slightly tilted back. This is an inefficiency of the aircraft caused by the fact that wings cannot be made infinitely long, and instead of perfect 2 dimensional flow around an aerofoil, the wing tip allows some air to circumvent the wing, and go around the edge. This creates wingtip vortices which change the local airflow around the wing. It also creates spanwise flow (flow outwards/inwards) that creates even more vortices at the trailing edge of the wing.

Induced Drag
The wingtip vortices have energy which they have taken away from the aircraft by the form of this “induced drag”. The way induced drag is formed is that the vortices cause upwash ahead of the wing and downwash behind it, meaning that the angle of attack of the aircraft is split into two separate angles, the effective angle of attack (which the wing can use to create lift) and the induced angle of attack, which is effectively “stolen”, and means that the aircraft ends up creating lift at a slight angle backwards, causing a small amount of the lift we produce to become drag.

Induced drag is greatest when the wing is at high angles of attack, as this creates the largest pressure differential between the bottom and top of the wing surface, and therefore the air has more affinity to flow around the wingtip to equalise this pressure, hence the stronger vortices, and more energy removed from the aircraft as induced drag.

Reduction of Induced Drag
Winglets are a common way to reduce induced drag, as they effectively block the movement of the air from bottom to top, and re-coup some of the energy from that air. Increasing the aspect ratio (span/chord, i.e. making the wing thinner and longer) also reduces induced drag, as more of the wing is further from the wingtips if the wing is longer. If more of the wing is further from the wingtips, then less of the wing is affected by the presence of the wingtip vortices, and there is less induced drag.

Washout is the correct answer here, as it is also a method of decreasing wingtip vortices and therefore induced drag. Washout on a wing is where the wing is twisted slightly to give the wing tips a lower angle of incidence (and therefore a lower angle of attack in flight) than the wing root. It therefore means that the angle of attack is lower at the wing tips so the pressure differential between the underside and top-side of the wing is less near the wing tip to reduce the amount of air flowing over the wingtip and creating vortices. This reduces induced drag, and washout is also used as a design method to delay wingtip stalls.