**Core Concept**
Anti-mullerian hormone (AMH) is a protein hormone produced by the granulosa cells of small antral and pre-antral follicles in the ovaries. It plays a critical role in regulating follicular development and sex differentiation during fetal development.

**Why the Correct Answer is Right**
AMH inhibits the growth of ovarian follicles by binding to its receptor, AMHR-II, which triggers a cascade of downstream signaling pathways that ultimately lead to the suppression of follicle-stimulating hormone (FSH) receptors. This hormone is also used as a marker of ovarian reserve, with higher levels indicating a greater number of antral follicles. The clinical utility of AMH lies in its ability to predict ovarian response to fertility treatments and to diagnose premature ovarian failure.

**Why Each Wrong Option is Incorrect**
**Option A:** This option is incorrect because AMH does not directly stimulate the growth of ovarian follicles. Instead, it inhibits follicular growth and development.
**Option B:** This option is incorrect because AMH is not produced by the Leydig cells of the testes. Instead, it is produced by the granulosa cells of the ovaries.
**Option C:** This option is incorrect because AMH does not promote the development of male secondary sexual characteristics. Instead, it is involved in the regression of the Mullerian ducts in males, which would otherwise develop into female reproductive organs.

**Clinical Pearl / High-Yield Fact**
AMH is a useful marker for predicting ovarian reserve and guiding fertility treatment decisions. It is particularly useful in women with polycystic ovary syndrome (PCOS), where high levels of AMH can indicate a poor response to fertility treatments.

**Correct Answer: B. AMH is produced by the granulosa cells of the ovaries, not the Leydig cells of the testes.**