**Core Concept**
The question is based on the fundamental principle of molecular biology, specifically the **genetic code**, which is the set of rules used by living cells to translate information encoded within **genetic material** (DNA or RNA sequences) into **proteins**. The genetic code is nearly universal and determines how **nucleotide sequences** specify amino acid sequences.

**Why the Correct Answer is Right**
Given that 4 nucleotides code for an amino acid, we are dealing with a hypothetical scenario where the genetic code is simplified. Normally, 3 nucleotides (codons) specify one of the 20 amino acids or a stop signal. However, if we consider a system where 4 nucleotides are used to code for an amino acid, the number of possible combinations (and thus the number of amino acids that could be coded) is calculated based on the number of possible nucleotides (4 in this case) raised to the power of the number of nucleotides per codon (also 4). This results in 4^4 = 256 possible combinations.

**Why Each Wrong Option is Incorrect**
**Option A:** This option is incorrect because it does not accurately reflect the number of possible combinations when 4 nucleotides are used to code for an amino acid.
**Option B:** Similarly, this option does not match the calculated number of possible combinations.
**Option C:** This option is also incorrect as it does not align with the calculation based on the given scenario.

**Clinical Pearl / High-Yield Fact**
It's crucial to remember that in the actual genetic code used by living organisms, 3 nucleotides (triplets) code for amino acids, and this results in 64 (4^3) possible codons, which code for 20 amino acids and 3 stop signals. Understanding the genetic code is fundamental for comprehending how genetic information is translated into proteins.

**Correct Answer:** Correct Answer: D. 256